🔒Coworking at a crossroads: Shared space was gaining traction, then the pandemic hit

Coworking was gaining traction across the state in 2019, including support from the state it hadn’t had before. But like so many other things that were gaining traction in 2019, 2020 was a huge brick wall.

Now those who run coworking spaces from York to Aroostook county are waiting to see if the vacuum of empty office space sucks up the state’s pandemic-fleeing new residents. They say it’s about more than just a business, but a loss of a community and culture that was becoming part of the state’s economic fabric.

“COVID’s had an impact,” says Marc Feldman, director of Think Tank in Biddeford. On a recent Zoom call with Mainebiz he sits in front of a background that shows an obviously pre-pandemic group of Think Tank members sitting around a large table, talking and laughing.

“The people in that picture, they’re not here anymore,” Feldman says. While private offices at the Pepperell Mill site are in hot demand, the “floating members,” coworking’s bread and butter, are no longer around. “We need density, we need people. They’re the stability [of coworking].”

And while he, like many of the state’s coworking owners, sees a future with the new residents flocking to the state, he worries something will still be lost. In the five years Think Tank has been in the space, “we’ve become a family.”

Sean Ireland, of Windward Development, agrees. Ireland is one of the developers of Union + Co., which opened in Bath in May 2019. The 14,000-square-foot space combines private offices, art studios and event space.

“We had happy hours, we had events, we had lunch-and-learns,” Ireland says. “That has been more difficult to do, it’s been more difficult to maintain that community culture. But our members miss it, they want it, and they can’t wait to have it back.”

But on the midcoast, where office inventory is lower and the needs of residents are different, he’s not as worried as Feldman.

He adds, “We’re expecting an enormous summer.”

‘A lot of work to do’

The question for many coworking spaces, wherever they are, is what that “enormous summer” will look like.

While Biddeford and Saco continue to be a popular destination for new residents, Feldman says that who they are, and where they’re working, is key to figuring out Think Tank’s future role. And, he asks, “How will they find us” in a market possibly glutted with small offices up for lease, as employers rethink how they’ll run their offices. It could be a challenge. “We’ve got a lot of work to do,” he says.

Patrick Roche, founder of Think Tank, which also has locations in Portland and Yarmouth, says he’s worried traditional floating members, the freelancers and remote workers, will get comfortable working at home and won’t come back.

The office vacancy issue also looms. Both he and Feldman are wary of what impact the changing market will have, particularly the possibility of large empty spaces being renovated into small private offices, siphoning away the coworking crowd.

“I think there’s a lot of concern that [commercial property owners] will start to pivot toward small offices and dilute what little ground we’ve gained,” Roche says.

The commercial real estate industry is also waiting to see how things play out, though there’s a hunger now with many businesses to get back together in one space, says John Finegan, of Boulos Co.

One key is the new Maine residents, Finegan says in this year’s Boulos Co. market outlook. “Will some of these newcomers turn into new office tenants? Will they bring new jobs with them? Coworking spaces could see an uptick in demand if companies headquartered in other states provide a budget to help satellite employees.”

Lewiston quick pivot

If traditional office space owners are like the new owner of the 20,000-square-foot Professional Building at 145 Lisbon St., in Lewiston, the change to mini-offices may not be a permanent one.

J.L. Dale LLC bought the building in December. It has a couple larger tenants, but its 85% occupancy rate is mostly tenants of micro-offices, who share wifi, bathrooms and a copier, says Frank Carr, of Maine Realty Advisors.

The 10-story building is 25 feet wide and 100 feet long, so it lends itself to the pandemic market. Each floor is 2,000 square feet “and it’s difficult with that floor plate to lease two, or six or eight-thousand square feet to one tenant.” 

But it’s not difficult to lease smaller offices to people working from home who “want to get away from the refrigerator, get away from the dog.” Those tenants are snatching up small spaces.

While it’s not the traditional coworking model, it’s the model people want now, when they’re not interacting as much, he says. Most of the leases are month-to-month, and it’ll be easy to switch back to leasing larger spaces when the time comes.

“It can pivot quickly,” Carr says.

That said, the basement of the former bank building may be developed into a traditional coworking area, with three or four seating areas and some private offices, says Carr, who’s also a partner in Bath’s Union + Co.

That plan may take shape this summer.

A rural pulse

While Union + Co., like Think Tank and other coworking spaces, lost a lot of floating members, “Our private office space has been full and we have a wait list for it,” says Ireland. 

That’s also true at another coworking space in Belfast. The Office, which opened in 2012, underwent a major renovation adding space and private offices right before the pandemic hit.

The Office and spaces like it are vital to an area like Belfast, says Monet Brazier, a member and Belfast area real estate broker. They’re “the pulse of the community” in smaller-town Maine.

“I think it’s evolving into what it’s going to be like in the next several years,” she says.

In many cases, such spaces are a necessity. At Union + Co., “We’re surrounded by peninsulas with terrible wifi,” says Mandy Reynolds, another Union + Co. partner.

People in surrounding towns are used to coming for Bath to shop, eat and more, and coming to a coworking space there is just part of it. She doesn’t see that changing.

Smaller spaces in smaller communities

Ireland says the future success of coworking in Maine is about scale.

“What we’re seeing is smaller spaces in smaller communities,” he says. “They want remote working, they want coworking because they want that private space, they need that dedicated space to be productive, but they want that sense of community.”

The industry is also boosted by the state’s Economic and Community Development Department, which oversees the Coworking Development Fund. Created in 2015, the fund was dormant for a few years until 2019, when Gov. Janet Mills took office. It’s awarded 16 grants of up to $20,000 to coworking spaces throughout the state and more is budgeted for this year.

“We look at it as not just coworking, but as collaborative space,” says Martha Bentley, DECD director of economic development coordination. She says that many of the coworking locations have maker space or are innovation hybrids.

“We still see collaborative workspace as important to our economic development strategy,” she says. In the “short long run” it’s a big asset to drawing people into the state, and in the longer term it adds to the vitality of towns and cities, bringing people downtown who gather, eat, shop and more.

Bentley sees a future where large-project focused groups will work near each other to collaborate, something that already happens in some of the spaces. It’s about more than just people working in small offices and sharing conference rooms and wifi.

“It comes with a community of other like-minded people,” she says.

Can’t put a price tag on it

An example of that community has emerged since the pandemic. A biweekly meeting for those interested in applying for the state grants has turned into a roundtable for representatives from coworking spaces across the state to get together and share information, whether they’re applying for grants or not.

Bentley says she’s impressed with the resilience and “stick-to-it-ness” of the community and how they support one another.

Feldman, in Biddeford, says that in the end that culture is what will separate coworking from landlords with a lot of office space looking to capitalize.

It’s hard to convey the community feeling that grows in coworking spaces, he says.

“You just can’t put a price tag on it,” he says. “But it’s a necessity.”