Gains in coworking space mixed
Photo/Tim Greenway
Patrick Roche expects his new coworking space at 533 Congress St. in Portland will be a hub for small businesses and freelancers
It's been roughly a year since two coworking spaces brought the global shared-office trend to Portland. Their success here has been mixed. The larger of the two spaces, PelotonLabs, a sleek upper-Congress Street spot with an eclectic blend of blue and white-collar businesses, is at half of its capacity after months of stop-and-start growth. Across town, the creatives-based Think Tank, with a footprint half that of Peloton's, this month plans to open a second Portland location twice as big as the first to accommodate overflow. Both locations report modest revenue and profit.
Though growth has been inconsistent, the founders of Peloton and Think Tank believe the networking, efficiency and cost-cutting benefits of coworking mean it's only a matter of time before it catches on here. They have discovered that the key to successful coworking — defined as a collective of otherwise unaffiliated people working alongside one another — lies not in
attracting freelancers but in recruiting the staffs of small businesses.
“I think so many businesses now allow their employees to work remotely and that's the demographic I'm going for,” says Think Tank founder Patrick Roche, a former member of the Paragraph writer's coworking space in New York City. Some 85% of Roche's membership on Exchange Street works for small businesses with more than one employee. Nationally, small businesses have flocked to coworking spaces, choosing them over independent bricks-and-mortar because of their networking opportunities and relatively low overhead.
Roche and his business parnter Eric Poulin expect that their new Think Tank at 533 Congress St. in Portland's downtown will be a hub of networking opportunity for small business staffs and freelancers alike. The new location can support around 100 members, about as many as Peloton and twice the original Think Tank's capacity, some with dedicated desks or private offices, others with “floating memberships” that buy access to the facility's common area. The $600 per-month private office rates will be on par with Peloton's, but Roche's $100 for 24-hour, every-day access is roughly half that of the competition. Roche, a writer who serves on the board of the local arts booster MENSK, envisions “synergistic programming” with area arts heavies like the Maine College of Art and Space Gallery, both of which are located on the same block as the new Think Tank.
Roche's first-year revenue at the Exchange Street location was $50,000, which he says made the business cash-flow positive. He plans during the second year to double Think Tank's overall income between its two locations.
On a recent weekday, the 32-year-old Roche steps over carpet scraps in his skeletal, half-renovated new location to point out the corner where he plans to put a small stage.
“This is more of the total vision that I had,” he says of the airy, color-splashed 6,000-square-foot coworking space he imagines will moonlight as a gallery, movie theater and all-around arts venue. “This is more of the flagship and, oddly enough, the original will become the annex.”
Real estate developer and PelotonLabs owner Peter Bass's two-floor coworking space at 795 Congress St. has focused for months on the events-based recruiting Roche hopes to launch soon. Among his 50 members are six small businesses with memberships for more than one staffer, like the window installer Jacob's Glass and the moving company, Local Muscle Movers. With first-year revenue at roughly $60,000 and membership at half Peloton's 100-person capacity, Bass doesn't plan to expand until he can “prove it's a viable business.” He owns the property and considers Peloton as much a real estate investment as a business venture, since he doesn't think coworking is a particularly lucrative sector.
It's unclear yet how much money there is to be made in coworking, though the model's quick global proliferation certainly suggests it's serving a widespread need. Coworking first emerged in 2009, according to The Economist, thanks to cloud computing and increasing demand for flexible schedules from women and home-bound workers, some of whom struggled to adapt to solitude after being displaced or laid off from more traditional office environments.
Deskmag.com, an online magazine about coworking spaces, counted 1,320 dedicated coworking communities worldwide in February, up 88% from the same time last year. The United States continues to dominate the trend with the most coworking spaces in the world — 537— and NYC has more coworking spaces than any other city on the planet. (For more, see “Coworking space taps into rising trend,” Mainebiz, June 14, 2011).
Even rural Maine is giving coworking a try. In January, construction was completed on what might be Maine's first rural dedicated coworking space. Located an hour north of Portland in Readfield, Central Maine Community Office Space takes a different tack on coworking than Peloton and Think Tank. Rather than operating exclusively as a coworking space, CMCOS is owned and operated by the education nonprofit Syntiro, which uses it as its permanent office. Syntiro's five-person staff works in the 2,700-square-foot building, which can accommodate around 15 additional people, and the nonprofit plans to lease the spare desks, offices and the conference room on an hourly or month-to-month basis. This model represents the majority of coworking communities, according to Loosecubes.com, which matches workers with dedicated coworking spaces. Loosecubes reports that 68% of the space on its site is in small, private companies with spare desks.
CMCOS doesn't have coworking members yet because it has just begun recruiting. Syntiro's president, Kathryn Markovchick, expects CMCOS will cater to home-based employees of small to mid-sized nonprofits in the Augusta area.
Markovchick hopes for one or two full-time coworkers this year, and double that next. Meeting even these conservative revenue goals will help Syntiro subsidize the mortgage on its new $160,000 property. n
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