Tag: Europe

Born a few kilometers away from the Harvard University campus, the Cambridge Innovation Center (CIC) has been a home for great entrepreneurs leading fast-growing companies since 1999. In 2018, CIC raised US$ 58 millions from HB Reavis, the Bratislava based real estate developer. We have interviewed Kari Mruz, the General Manager at CIC Warsaw, to find out more about CIC values, mission, strategies and plans for the future. Kari will also be a speaker at the Coworking Europe 2019 conference, this fall.

Hi Kari. Can you introduce yourself and explain us what CIC is and what’s its mission?

I am the General Manager at CIC Warsaw. The Cambridge Innovation Center designs, builds and operates innovation spaces and communities. We believe that innovation is the best way to solve local and global problems, so our goal is to provide entrepreneurs with the communities and infrastructure they need to succeed. In 1999, “coworking” wasn’t a household term, let alone a standard office option. That year, CIC became the first provider of shared office space in Cambridge’s Kendall Square, now known as the most innovative square mile on the planet. The mission was the same then as it is now: to support entrepreneurs in fixing the world through innovation.

How does a company from Cambridge MA, close to Harvard and other prestigious names, figures out it makes sense to replicate the model on other continents?

There are talented people with great ideas everywhere, not just at Harvard and MIT, and CIC seeks to support even broader impact by tapping into the innovation potential of other communities throughout the world. The more cities we go to, the bigger network effect we can create. That said, we don’t tend to rush into new cities. We spend a great deal of time developing deep partnerships and collaborating with local leaders before we begin to build anything.

How do you combine the coworking business and the training/innovation inputs you are providing? Why does it make sense to interlink the coworking and “innovation” sides? 

Coworking is naturally linked with innovation because whenever people share physical spaces, they start to bump into each other, trust each other more, take more risks, share ideas, and collaborate to create things they wouldn’t have on their own. From the other angle, coworking can benefit from innovation, because it is always more fun to work in spaces where people are doing interesting and impactful things. In terms of our business model, we find central locations in core cities to create the nexus for innovation – by leasing office space and then providing it along with additional value to our members who join our communities through a monthly agreement to work in our office space and access additional benefits that go beyond just providing snacks and furniture. The added value includes events programming, shared intellectual capital, and access to the CIC network, which includes investors and corporate innovators who seek to work with entrepreneurs.

Coworking is naturally linked with innovation because whenever people share physical spaces, they start to bump into each other, trust each other more, take more risks, share ideas, and collaborate to create things they wouldn’t have on their own.

You raised capital, as did some other big international coworking players, recently. How do you differentiate from these other brands?

Similar to other big coworking players, we do aim to change the nature of workspaces, but primarily as a means to innovation, not just to make office life cooler. CIC’s type of deep, concentrated “innovation communities” are not simple to build. Our locations require very capable senior leadership and thoughtful staffing to thoroughly support the entrepreneurs who choose to work in our spaces. Also, keeping innovation as our central premise means that we end up building not just game rooms with ping pong tables, but also more complicated pieces like shared lab spaces and equipment that draw in scientists and technologists. This means we’ll probably expand slower than some of the other big players, with the intention of creating powerful ecosystems that generate long-lasting, impactful innovations.

Keeping innovation as our central premise means that we end up building not just game rooms with ping pong tables, but also more complicated pieces like shared lab spaces and equipment that draw in scientists and technologists

CIC is opening up in Warsaw and has already a location in operation in Rotterdam. What are the plans for Europe?

CIC is exploring a number of other locations in Europe and open to initiating discussions with other cities as well through our expansion initiatives. Our goal is to have 50 locations open in ten years, and Europe is a significant part of our growth plan as well as other regions globally.

Our goal is to have 50 locations open in ten years, and Europe is a significant part of our growth plan as well as other regions globally.

Why does Europe makes sense to you and how does it differentiate from the US or Asia?

European communities are unique, with each country offering its own set of innovators who respond differently to coworking environments. CIC looks to enter markets that are receptive to creating an impact through innovation. We partner with cities that understand how an innovation center can attract entrepreneurs and stimulate economic development, and work closely with local leaders to ensure that our strategies align with the region. We take a local, community-focused approach in all the ecosystems we build, whether it’s in Europe, the U.S., Asia, or elsewhere.

You will be located in the second tallest building in Europe to be completed soon in Warsaw. Does locating yourself in prime buildings belong to your strategy?

Choosing the right location and facility is really important for us, we’re really picky. We look for facilities that can provide a premium experience for our members, and locations that have the potential to be the center of gravity for innovation in the city. We couldn’t have picked a better location than the Varso tower complex in Warsaw. Not only will the Varso tower be one of the tallest building in Europe, but it will have direct underground access to the central train station, and huge floor plates in the Varso 2 building we will be located in, allowing us to build large event spaces on the same floor as our office space offering.

You focus on some specific industries, such as “port activities” in Rotterdam. Is the focus a case by case assessed choice or are you globally focusing on a limited number of areas?

A focus on specialized industries is one of the things I’m most excited about for CIC’s future. For now many of these are very case by case, determined by the particular strengths and goals of a given city. However, ultimately these communities can and should be linked – for example, technology developed in our robotics community in Boston could be used in a port in Rotterdam.

Ultimately these communities can and should be linked – for example, technology developed in our robotics community in Boston could be used in a port in Rotterdam.

 

Coworking has be around for more than a decade in Europe. Nowadays, coworking reaches out to every corner of the continent. BNP Paribas Real Estate released a study spotting the new upcoming coworking hotspots in Europe and what drives the growth. We interviewed Richard Malle, Global Head of Research and Vincent Voute, Senior Research Analyst, to tell us more about their findings.

Hello Richard. Hello Vincent. According to your research, London and Paris are experiencing a deceleration in terms of coworking growth. Are the best days over for coworking in these metropolises?

The growth rate of coworking is indeed slightly decelerating in London and Paris. However, with +13% and +19% of space taken-up by coworking operators, 2018 still saw a 2-digit growth in both cities. In terms of volumes (transacted m2), the take-up for coworking spaces reached significant values in both cities already two years ago, and represented again by far more than 100,000 m² of new coworking space in 2018. Consequently, the slowdown in growth is not a sign of a weakening market. This is just more difficult to achieve a high growth rate when it is calculated on the basis of big volumes. On the contrary, it seems that coworking still has room to expand in the two metropolises. Indeed, existing coworking spaces show high rates of occupancy while coworking still represent a limited share of the total take-up (13% in London, 5% in Paris). The demand for coworking workstations is far from fading. Rather than being saturated, we consider that the market is becoming more mature.

The demand for coworking workstations is far from fading. Rather than being saturated, we consider that the market is becoming more mature.

Frankfurt, Munich, Madrid, Brussels, on the other hand, show no signs of slowing down. Do you expect the saturation level to come soon in all the other major cities in Europe?

The new trend about coworking is that the market is no longer limited to the usual largest commercial real estate markets that are London and Paris.

In other European dynamic cities, coworking now represents a significant share of the market activity, for instance in Amsterdam, Brussels, Dublin, Madrid or Warsaw (NB : Warsaw will the the hosting city of the Coworking Europe 2019 conference , organized by SocialWorkplaces.com), where it represents more than 10% of the total office market.

Major global coworking operators seem to consider these cities as potential drivers for future growth and are now starting to take a close look at these markets.

The growth of the EU coworking market is driven by the big international players. Have independent operators to find a niche?

Our European coworking research shows that most of the new coworking spaces are created in central parts of the cities, or at least in the well-established business districts. This appeal for these sought-after districts has a cost: this is where the rents are the highest and where the competition for the best buildings is the fiercest.

Big international players can afford to pay high rents to lease large units in the most modern buildings located in prime districts. They are also able to provide a lot of services – which requires more employees –, or advantages such as a global membership that enables their members to access their spaces everywhere in the world, etc…

This is very unlikely that independent operators will be strong enough to compete on such levels. They consequently have to find a way to differentiate themselves from the big players to attract customers and to position themselves on their own market segment.

How about property owners developing their own coworking brand and offering, like in Warsaw: is it a marginal phenomenon or do you expect it to strengthen? 

As an always growing phenomenon, this is logical that the flexible office market arouses interest among the whole real estate sector. However we consider that property owners should make sure to implement a solid and well-thought strategy and business model when entering the coworking market.

Running their own brand is indeed a new kind of activity for them to which they have to adjust. The question of the economic risks is also important: launching their own brand implies that risks are not shared with the tenant but fully taken by them.

The acquisition of existing coworking brands by major investors is another possibility for real estate players to enter the market while benefitting from the experience of these existing brands. As long as the market continues to grow, we can logically expect this phenomenon to strengthen.

You refer to new forms of collaboration. You mean between operators? Maybe another kind of players? 

We actually referred to the new forms of work organization which tend to require more flexibility for which coworking seems to be an appropriate response.

TSH (The Student Hotel) has been developing  a co-living and coworking offering for more than a decade. Founded in The Netherlands by Charlie McGregor, a Scot born in Edinburgh, TSH operates 10 locations in various cities in Europe, among which Rotterdam, Amsterdam, The Hague, Eindhoven, Paris or Barcelona. TSH plans to open up a total of 40 locations in European cities by 2021. Florence, Dresden, Bologna, Madrid, Berlin, Rome, Vienna or Toulouse are in the pipe.

Hi Charlie, can you introduce yourself and tell us about how The Student Hotel started?

My father built the first purpose-built student rooms in Edinburgh, where I grew up.  At 25 I bought a small student accommodation company and sold it 10 years later when I moved from London to Amsterdam and started The Student Hotel. The first Student Hotel project was completed just as the full implications of the global financial crisis unfolded. But we pressed on.  

You offer many different perks within all your locations, going from hotel services, gym, food, up to coworking spaces (TSH Collab). Do you operate everything yourself ? 

We operate the accommodation and coworking ourselves.  In some we also operate The Commons – our restaurants and bar brand; in other places we work in collaboration with local companies.  In Florence, for example, we partner with local restaurant, La Menagere and at TSH Campus in Barcelona the partnership is with Grupo Raval.  At TSH Amsterdam City we have an Olympic length (50m) pool and crossfit Vondelgym run by local celebrity athletes.

Is TSH a student only place, as the name indicates it?

TSH is much more than student accommodation. We have students staying for a term or a year, but we also have hotel and co-living guests.  That’s just on the accommodation side.  Then there’s the local startups and entrepreneurs in our Collab coworking spaces, classrooms and auditorium.  All our hotels are open to the local community who come to enjoy the restaurants, bars and super fast, free wifi in the communal spaces and we actively encourage this mix.  We want people make connections they may not find somewhere else.

Why having a specific coworking offering on top of your other services makes sense? 

There was a demand.  Guests and the local community needed coworking space.  TSH Collab was created to answer that need – a step up from working on a laptop in the lounge or bar.  The upward trend of entrepreneurs, startups, freelance workers, and digital nomads is growing fast.  With TSH Collab we can offer everything under one roof.

The benefits are that all our guests – whether they are studying, staying in the hotel, or working – have a place to connect with each other.  It creates a dynamic vibe that enables people to get things done. 

In addition, parents, friends and family need somewhere to stay when they visit our student guests, they need somewhere to eat and socialise.  Our co-living guests need somewhere to meet and work.  We are continually asking ourselves what future guests will need and add services that make sense.  We call it the Complete Connected Community.

Are the co-living ‘guests’, in majority, the users of all the other different services? 

TSH is open and inclusive.  You don’t have to be a guest to eat or drink here.  You don’t have to be a TSH Collab member to stay or use the communal spaces.  We have an amazing mix and are happy that people can take advantage of the things they want to use. We are a Complete Connected Community.  That runs through everything we do – the community feeling is central to both co-living and coworking at TSH.

Guests and the local community needed coworking space.  TSH Collab was created to answer that need – a step up from working on a laptop in the lounge or bar. 

How do you position yourself as opposed to other workspace operators?

TSH employs a Connector in each location and that person plays a crucial role in all The Student Hotels, ensuring that our guests and community members have the possibility to truly connect during their stay and before or after via our digital- and social channels. The Connector position is the glue that holds together our co-living, coworking, co-dining communities. The TSH Connector is more than just the leader of our fun squad. A true connector turns our mishmash of hotel guests and coworking professionals into a cohesive community of both students and students-at-heart. The Connector position is the glue that holds together our co-living, coworking, co-dining communities. He/she encourages people to meet and inspire each other by events and programming based on the four brand themes of The Student Hotel: Social&Cultural, Health&Sports, Learning, and Career&Entrepreneurship. The Connector is the open door for everyone who likes to join our community because they are the most connected person in our buildings.

A true connector turns our mishmash of hotel guests and coworking professionals into a cohesive community of both students and students-at-heart.

You don’t introduce yourself so much as just an accommodation provider, and focus more on the co-living side. What is the difference between the two concepts? 

Our student guests can stay for a term to a year as part of their international studies.  Co-living guests are usually with us for a couple of weeks to a few months; digital nomads, freelancers or contractors who find themselves in a new city for work.  Hotel guests usually stay from a night or two or a week.  The co-living element comes from the community feel – we don’t differentiate, we don’t separate.  Everyone gets to live side by side, use the same facilities, regardless of how long they are with us.

The co-living element comes from the community feel – we don’t differentiate, we don’t separate.

By 2020, you expect partnerships with 1.500 universities. Do you position yourself as the solution provider to move away from the “student housing crisis” that some campus face, with innovative models? 

The world of higher education and training is subject to massive changes: rising international student mobility; transnational campuses, online learning, summer schools and life-long learning have dramatically altered the demand for accommodation. We see a growing demand for short-term and flexibility coupled with a sense community and shared values and purpose. It was a void between hotels and student dorms that TSH is filling with its variety of coliving arrangements. In that sense we are complimentary to the current offering.  

It was a void between hotels and student dorms that TSH is filling with its variety of coliving arrangements.

Based on your experience, should the coworking industry take its inspiration from the accommodation and hospitality industries?

We should take our inspiration from everywhere; the reason CO applies now to living and working shows a growing space of new opportunities. Hospitality teaches us the importance of service. Accommodation, the importance of a home and a sense of community. At the current architecture biennale in Venice the Dutch pavilion is dedicated to Work and it underlines that since Yoko Ono and John Lennon demonstrated for peace in bed we have started using the bedroom as a space to work. We constantly see new opportunities to improve our concept and operational model; new technology enables us to connect and stay in touch with our growing customer base while the way our customers study, travel, sleep and work is changing year on year.  We see more and more barriers between hotels, office space, restaurants and residences being broken down. That is why is say we are – also operationally – a Complete Connected Community. Hybrids like The Student Hotel will become the norm as we are satisfying more needs than just a place to work or a roof over your head.

Since Yoko Ono and John Lennon demonstrated for peace in bed we have started using the bedroom as a space to work.