Being the fourth largest city in Canada by population and branded for its government feel, Ottawa isn’t known as an early adopter to real estate trends. However, coworking spaces, which are identified as forward thinking and a disrupter to tradition, are on the rise in Ottawa and increasingly making the capital home. Why is that?
A city most outsiders would consider a ghost town past 5 p.m., is becoming progressively trendier and energized. With the technology sector now being the second largest office occupier in the downtown core, more entrepreneurs are successfully co-mingling with the 9-5 government workers and planting their roots here. Thanks to large tech firms like Shopify, Telesat and Survey Monkey, Ottawa’s central business district (CBD) is evolving.
Who knew opposites could cohabitate so well in Ottawa?! Well, in part thanks to the government, Ottawa is a stable market and has one of the highest median household incomes in Canada. Also, a highly educated city known for its post-secondary schools, Ottawa is a great breeding ground for startups. The hot residential real estate market in larger cities like Toronto are also drawing those who can work remotely in Ottawa. Most of those migrators crave a collaborative environment too; or at least more than their kitchen table or a coffee shop can accommodate.
So, where do coworking spaces come in?
Coworking spaces are not a new concept. In fact, they have been on the rise in most of the larger Canadian cities for some time now. Startups and entrepreneurs love them. They are great for networking, collaborating and seen as a startup incubator. Instead of the stereotypical story of entrepreneurs starting a vision in their parents’ basement, they can now accelerate growth in coworking spaces, with little long-term commitment and capital. Believe it or not, it was not long ago that companies like Shopify were residing in 1,500 square feet in Ottawa.
Regus, a coworking giant and one that has numerous locations throughout Ottawa, is currently looking to expand further in our market due to their low vacancy and popularity. Smaller coworking hubs that have found a niche by specializing and catering to a specific sector are flourishing as well. Such groups like Impact Hub Ottawa with a focus on not-for-profits members are gaining popularity, and not long ago expanded in the CBD.
Are Landlords taking notice?
A great example of a new technology startup accelerator to Ottawa is OneEleven. Their recent move to 66 Slater Street could be a shock to some. This was a building that previously leased space to DND and Canadian Forces Recruiting Centre; it did not seem like a plausible candidate for a forward-thinking hub. However, the landlord seized the opportunity to welcome OneEleven and rebranded to accommodate. Office space and thus company cultures are evolving for the better, and employers are learning (and loving) to share.
Landlords are listening to flexibility.
Renovating office buildings to accommodate ample amenities with flexibility in all senses is on the rise. Gone are the days when landlords would shy away from additional maintenance, management and costs associated with more common areas. Take the Sun Life Financial Centre building, which has disrupted traditional lobby income streams with co-sharing opportunities for food retailers. Manulife’s 220 Laurier building has joined the movement by creating numerous ease of mind turnkey suite options and a new shared upscale conference room. More amenities in the building such as gyms, showers, roof top terraces, bike rooms and other communal areas are becoming increasingly in demand. More flexible leases are on the rise too and landlords are offering more clauses to accommodate fast-growing tenants that may not be able to lock into a long-term lease. Groups like not-for-profits in Ottawa are often tied to government funding cycles and may need a more accommodating lease as well. Landlords, more than ever, are considering the complexities of tenants needs just like coworking groups have done from day one.
Thanks to coworking spaces, these hubs are disrupting the office landscape. Landlords that adapt will be first in line when their members outgrow the traditional office space concept but want to continue the sharing lifestyle.
Jessica Whiting is a broker in Ottawa who specializes in office leasing; tenant and landlord representation. Jessica has experience with notable private sector companies in the downtown core, not-for-profit organizations and has worked alongside several local landlords and REITs to successfully lease out office space.