Flexible Office Geo-Located : The relation between flexible office types and location in Shanghai

Abstract:

Building upon the global trends of digitization and sharing economy, co-working spaces, serviced offices and maker-spaces are the new options in the market besides the traditional office spaces. Despite their popularity, there is limited understanding on how these formats and their business models relate to their location. Understanding target users and business models interrelated with location enhance project evaluation and assessment tools for investors and decision makers. We frame this topic by taking a closer look at Shanghai. 

[Location of Co-working Spaces, Serviced Offices and Makerspaces – Shanghai (logonLAB 2018)]
[上海联合办公、服务式办公、众创空间空间区位(罗昂实验室 2018)]

FLEXIBLE OFFICES TYPES: DEFINITIONS.

Providing diverse space solutions and renting options, co-working spaces, serviced offices and makerspaces are considered as flexible office spaces against the traditional office format. Following is how we define them based on our research findings and understanding.

Coworking Spaces. They provide office space typically in very good locations. Renting a desk, a small office or an entire floor at short and variable conditions. Public spaces like a lounge, seating areas, and coffee area are open and available to all members. The atmosphere is that of a community, sharing and communication spaces are the highlights. All-you-can-do app and cloud technologies provide easy tools to support working and networking activities.

Serviced Offices. Or business centers, they are actually the first attempt to provide more flexible options compared to traditional office spaces. Also situated in very good locations, especially CBD areas, while recently they are broadening their offer with hot desk options in open space, they generally provide small furnished offices and related business services such as reception, IT, cleaning etc. However, compared to co-working spaces, they remain more business oriented, both for the offer and as the atmosphere.

Makerspaces. As part of the innovation chain to promote mass entrepreneurship, the makerspace is the upgraded model of incubators and accelerators, with fewer criteria to comply for start-ups moving in (1). There are six types of makerspaces:

“Corporation Platform”- in order to absorb new ideas and customers,

“Angel+Incubator” – angel investment fund for start-ups,

“Open Space” – entrepreneurial ecosystem building,

“Media-based” – help to attract customers in a short period of time,

“Real Estate-based” – fewer services compared to other types, still developing,

“Vertical Industrial” – targeting towards one particular industry, often organized by government or official organizations.

The atmosphere of the makerspaces varies with the type or the single case.

DIFFERENT LOCATIONS DIFFERENT PRODUCTS.

We believe that having the city ring roads as a reference for location analysis can instantaneously communicate an overview of the city to the mind of the reader. According to our research findings, each flexible office product is more keen to be located successfully in some locations rather than others. There is no formula to evaluate a location, but a combination of multiple factors, such as public transportation accessibility, availability of talents and urban context (surrounding functions, the status of development, policies in effect, etc). For example, very good public transportation access is a necessary condition for co-working spaces and serviced offices, while it becomes a plus for other office types. Reading the outputs of the maps, we notice that co-working spaces are located in downtown, within the city Inner Ring, and especially along YanAn Road.

Serviced Office locations follow the same pattern but more closely to that of Grade A office and in CBD areas. A different paradigm emerges from makerspaces location analysis. Makerspaces are mainly located towards the Middle and the Outer Rings, with a concentration near the main universities campuses. However, their location pattern is comparatively more dispersed and distributed all over the city territory.

Types of Workplace by location – Ring (logonLAB 2017)

Types of Workplace by location – District (logonLAB 2017)

Looking at the same information but distributed by districts, we observe that while co-working and serviced office are mostly located in Huangpu, Jing’An and Xuhui Districts, makerspaces are scattered among all districts, with the highest number in Pudong, then Xuhui and Yangpu districts.

These results actually are related to the urban context of the districts. CBDs, university clusters, high-tech zones, etc, attract specific functions and types of people around them, and therefore types of business too. Creative people and free-lancers tend to choose city center locations, while hi-tech professions and scientists gravitate around innovation areas; financial and business experts are more attracted to CBD areas.

Families used to be in the focus of real estate developers, but the rising demand of young urban singles challenges the supply, especially in core urban areas. When looking for living space, singles tend to choose locations in proximity to their workplace and with good access to public transportation. Good facilities in the surroundings, like convenience stores, restaurants and sport facilities, are another important factor. They focus more on cost efficiency, and prefer smaller and cozier units compared to traditional units targeting families.

Both government policies and housing market are responding to singles housing demand while promoting a better use of the existing housing stock. Shanghai is currently enlarging its share of small-to-medium-sized apartment units, especially in downtown areas[1]. Home-purchasing restrictions[2] further accelerate the expansion of the rental housing market.

The market is responding with new housing concepts, for example long-term rental apartments, dormitories and co-living spaces. They suit the needs of young urban singles and their modern way of life. Compared to traditional family apartments, long term rental apartments focus on privacy for individual rooms and offer shared public facilities. (See fig. 2). Buildings dedicated to such apartments often provide additional service facilities, like gymnasiums, billiard rooms, laundry, where social interactions can occur.

[2]In 2016, Shanghai enacted a housing policy to increase the offerings of small-to-medium unit types (especially units with size smaller than 90 square meter) in order to improve its housing supply structure and land usability. The policy requires more than 70% of small-to-medium unit types to be within city center and more than 60% in suburban areas.

[3]“Singles” with “Hukou” are allowed to purchase one house, whereas “singles” without “Hukou” are not allowed to purchase houses .

Fig. 2. Traditional Apartment Layout Targeted to Families (Left) and Long Term Rental Apartment Layout Targeted to Singles (Right).

By logon Interior Design Team

Similarly, and blurring the line between hospitality and residential sectors, co-living formats are emerging too. Communal spaces and on-site services, combined with online booking services, characterize the concept of this new type of community.

Dormitories, especially in universities surroundings, are becoming a more popular option. Providing the minimal sleeping space, they target especially low-income singles.

Technology innovations facilitate the exchange of information and services between demand and offer. The formation of various online rental platforms and popularization of rental mobile Apps help singles to find housing or roommates, and enjoy various after-rental services.

When compared to foreign developed countries, the number of singles is set to grow even more in future. According to US’s census data [6], singles have accounted for almost half of the total population in 2016. The response to the rise of singles is happening and it’s just at its beginning. There is great room for further exploration of housing stock regeneration and business models development.

References:

[1] Chen, Yaya. The Inspection of the Life of Single Female Urbanities. 2011.

[2]China Census Bureau. Census Data. [Data file].

Available from http://www.stats.gov.cn/tjsj/pcsj/

[3] Shanghai Civil Affairs Bureau. Shanghai Statistics of Marriage Registration. [Data file].

Available from http://www.shmzj.gov.cn/gb/shmzj/index.html

[4] Shanghai Municipal Government. Shanghai Office [2016] No. 10. Shanghai Baoshan Planning and Land Management Committee, 13 May. 2016, http://www.shbsgh.gov.cn/60/47/50/57/2016513635506.html. Accessed 6 Nov. 2017.

[5] Shanghai Housing and Urban Rural Construction Management Committee. Shanghai Housing Management Association [2016] No. 1062. 29 Nov. 2016, http://www.shjjw.gov.cn/gb/node2/n4/n27/n29/u7ai1013896.html. Accessed 6 Nov. 2017.

[6] US Census Bureau. Historical Marital Status Tables. [Data file]. Available from https://www.census.gov/data/tables/time-series/demo/families/marital.html