Why hotels should invest in co-working spaces

Co-working has been of growing interest to the hotel sector, offering not only additional facilities and the potential for revenue growth, but also strengthening ties to the local community. For example, the latest hotel under Saco’s Locke brand, with co-working space for 152, has secured planning permission in London.

Real estate investment company Apirose is behind the £40-million, new-build 121-guestroom property, with Saco Property Group appointed development manager. The project is expected to be completed in April 2020. 

Hotel Connections

When Saco launched the Locke "aparthotel" brand, it said that each Locke property would be designed “to reflect the local neighborhood’s culture, taking inspiration from the local area to connect guests with like-minded locals and other travelers. Guests will experience bigger live/work spaces, innovative communal areas and a hotel-style service.”

According to the latest "Global Co-working Survey: The 2018 Co-working Forecast," 1.7 million people will be working in approximately 19,000 co-working spaces around the world by the end of this year. Contrary to the expectations from last year, the share of new co-working spaces did not decline, with 29 percent of all co-working spaces opened over the last year—almost the same ratio as in 2017. 

Around two out of three co-working spaces were planning to expand in 2018—slightly fewer than last year, but as there are more co-working spaces now, the total expansion volume is bigger. On average, every co-working space is planning to expand their area by 70 percent.

A third are planning to open at least one additional location. Around a quarter want to expand their existing co-working space, and roughly one out of 12 wanted to move into bigger spaces. 

Augmented Hospitality

AccorHotels entered the sector last year through a joint venture with Bouygues Immobilier, formed with the aim of accelerating the growth of Nextdoor in France and Europe. The two groups aimed to create 80 collaborative Nextdoor workspaces by 2022.

The move was part of AccorHotels’ strategy to rebuild itself as a hospitality platform, dubbed “augmented hospitality,” which has seen it invest across the sector, acquiring a sharing platform, concierge services provider and hotel reservations platform, among other offerings.

One of its key launches in this area was AccorLocal, which allows hotels to offer the services of local businesses and services, while also allowing local residents to access the hotel’s amenities. And it is here where the need for workspace in hotels becomes about more than just providing a service. 

“The question now is, is this truly a workspace?” said Imran Hussain, director of collaborative marketing agency THC/Endeavour. “Is it shelves, cabinets [and a] segregated workspace, or is it simply hot-desking?” The first incarnation of co-working was like hot-desking, or rotating desks among who was in at any particular time, Hussain continued, but then the trend pivoted into shared workspaces as people demanded a place to leave their laptops and files—not to mention some privacy for client calls. 

“When hotels offer workspaces, I question why,” Hussain continued. “Is it more for optimizing square feet or more about providing a service to its neighbors? Because only one of these is community-focused, and really, it should be about community. It has to be about people coming in every day, creating touch points and connecting.”

While Hussain does not believe that every hotel should have a co-working space, he does believe that every hotel should allow all guests (whether locals stopping by for the day or travelers spending the night) to use its public spaces. “Co-working does help bring creative minds together, engages the locals and creates a unique culture, which is a great thing,” he said. “If nothing else, in the hotel sector, we are all public servants, after all.”

This was emphasized by Eric Jafari, managing director of Saco Property Group. “Locke offers a unique take on aparthotel living,” Jafari said. “We understand that travelers no longer want just a comfortable night’s stay. They want an experience and to feel a part of a community—which is why each of our properties are designed to immerse guests in the local area.”

With an increase in immersion, more hotels may want to dip a toe into co-working spaces.

Katherine Doggrell is an editor at Hotel Analyst, the U.K.-based news analysis service for hotel investors.