COWORKING SPACE IN NYC: WHAT TO EXPECT AND NEGOTIATE

Coworking office space in NYC can be a great option if you’re looking to maximize flexibility, whether you’re a startup looking to take your first office space or any company looking to take flexible short-term space while you make long-term decisions. Providers like Industrious, WeWork, Spaces, and others offer furnished, wired, “ready to go” space that’s aesthetically designed and full of amenities — without the long term commitment. If you’re thinking about office space and wondering if coworking office space might be the best option, here’s what you can expect and what you should negotiate when it comes to coworking office space in NYC:

What You’ll Get in a Coworking Office Space in NYC:

    • Flexibility of a short term commitment: coworking space in NYC offers the option to take a 6 – 12 month lease (or even go month-to-month), which you won’t find anywhere else (unless you’re lucky enough to find a super short term sublease). A short term commitment gives you the flexibility to bring employees back to an elevated office experience while you figure out what hybrid work model works for you and how that affects your more permanent space options. Coworking office spaces will also allow you to extend on a month-to-month basis if you need a little extra time to tackle those long term decisions (you’ll just pay a little extra for the convenience of month to month).
  • Ready to go office space with access to desired amenities: coworking office space in NYC comes furnished, wired, aesthetically designed and has the amenities you need to (quite literally) walk in and start working. You have your pick of dedicated offices ranging from a 2 person interior office to a 20+ person windowed office, and everything in between. And no matter what size office you take, you have access to amenities like the reception service, community manager, coffee + snacks taken care of, Board room and conference room space, and in some cases shared outdoor space. Many startups choose coworking office space in NYC early on for these reasons, but they also apply to companies looking to bring employees back to an elevated office experience without the long term commitment and hassle of furnishing, wiring, etc. 
 
  • Membership agreement in lieu of a lease:  coworking office space in NYC offers 2 page membership agreements in lieu of a traditional lease; even if you take a sublease, several line items in the sublease agreement will point to a master lease that is likely 50+ pages long. Membership agreements will save you both time and the cost of legal lease review.
 

What You’ll Pay in a Coworking Office Space in NYC:

Prices vary depending on size with coworking office space in NYC, but from market leaders like WeWork and Industrious you can expect to pay between $5,000 and $20,000 per month — the monthly rent is dependent on which coworking provider you choose, number of people in the office, whether the office is windowed or interior, and where in the city the coworking space is location (like our trusty overpriced NYC apartments, certain neighborhoods come at a premium when it comes to coworking office space in NYC.

The good news? Your monthly rent on coworking office space in NYC is typically lower than you’d pay in a sublease or direct space — that’s because the space will be much smaller (technically on a per square foot basis you’re paying a premium) but for startups looking for their first (or any) office space in NYC and NYC companies looking for short term space solutions, the monthly rent will feel much more palatable compared to other space options.

The other good news? Coworking office spaces in NYC operate on a one-bill-covers-all model, meaning your monthly rent covers rent, electric, taxes, amenities access and an allotted amount of conference room hours.

The LAST BUT NOT LEAST good news? It’s our job to negotiate all of this. You know, so you can focus on growing your business.


What to Negotiate in a Coworking Office Space in NYC:

Like any space option, several aspects of coworking office space in NYC can and should be negotiated. Our job is not only to help you find the right location and office size for your needs, but also ask the right questions to get you the best possible price. Here’s what we’ll negotiate:

Free Rent: like any office space, coworking office space should come with free rent. You can likely expect at least 1 month free (depending on demand and how long of a term you sign), and they will layer this into your monthly rent so you pay a lower rent each month. 

Conference Room Hours: coworking office space providers in NYC give you an alloted number of conference room hours per month, after which you’ll pay their hourly rates. Negotiating additional conference room hours can be easily skipped but is a relatively easy “get” and can make a meaningful impact if you spend a lot of time in meetings.

Renewal Price Increases: much like coworking office space gives you the flexiblity of a short term commitment, you might find you want to stay after your initial term on a month-to-month basis or renew for a longer period of time. WeWork and Industrious can charge up to 10% increases for renewals, so to give yourself the option to stay at the best possible price you’ll want to pre-negotiate your renewal price increase at the beginning.

 

So, What Now?

In conclusion, coworking space in NYC is a strong option if you want to keep occupancy costs low and flexibility high as long as possible. In a post-pandemic NYC, coworking demand has skyrocketed as companies look to bring employees back to the office without long term commitment amid continued unknowns.

 

Why do I need a broker? Can’t I just reach out myself? Short answer: you can definitely reach out on your own (and many people do). A broker comes in handy when it comes to finding and showing you space options at different locations with different pricing tiers and knowing how and what to negotiate (and using non-public information to do it; for example, knowing what other companies we’ve recently placed in WeWork, Industrious and other coworking players paid post-negotiations will help you get a better price). And like any office space option in NYC (and in the US), this comes at no cost to you; we’re paid by the landlord — in this case, the coworking provider. If you have any questions or want to talk through your specific scenario, please reach out to us at hello@vicuspartners.com.

 

Continue Reading: Hybrid Work: What to Consider When Bringing Your Company Back to the Office

 
 

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