The U.S. coworking sector continues to gain momentum, fueled by the rising demand for flexible workspaces and the shifting work patterns of the post-pandemic world. With more companies emphasizing remote and hybrid models than ever before, coworking spaces across the nation have become more popular and accessible, spanning central business districts and suburbs alike.
Once again, we looked back at the last quarter to determine the evolution of the national coworking inventory, as well as the state of the industry in the 25 leading markets. We also broke down the total and average square footage covered by coworking spaces in each market, in addition to the top operators, to provide a comprehensive analysis of the coworking industry in the U.S., as seen in Q3 of 2024. For a comparison to the previous quarter, see the Q2 report.
National Inventory Grows by Another 7% with Nashville’s Total Increasing by a Significant 24% Q-o-Q
In Q2, the total number of coworking spaces in the U.S. surpassed 7,000 for the first time. Now, it has reached more than 7,500 flex workspaces — 7,538 to be precise. This represents a 7% quarter-over-quarter (Q-o-Q) growth, once again demonstrating a positive evolution of the coworking sector and a healthy demand and supply of flexible workspaces to support remote and hybrid work.
Of the 25 leading markets, only two stagnated in terms of coworking spaces — the Bay Area (124) and Salt Lake City (75). Additionally, all but one (Brooklyn, NY) of the remaining locations saw increases in their coworking inventories during Q3 of this year. The most notable was in Nashville, where the total supply grew by 22 spaces, or the equivalent of a 24% growth. Meanwhile, Indianapolis ended this quarter with a total of 85 spaces to account for a 12% increase since Q2. The third-most notable surge in inventory was seen in Philadelphia (9%), which went from 137 spaces to 150 in the span of three months.
National Rates for Coworking Memberships Remain Stable Across the Board
During the third quarter of 2024, the prices for coworking memberships remained generally stable with dedicated desks registering the same monthly median as in Q2 (precisely $300). At the same time, virtual offices and open workspaces saw very slight fluctuations quarter-over-quarter: both of their national rates increased by just $1 to $120 per month for a virtual office and $150 per month for open workspaces.
Virtual Offices
The nation’s capital continues to boast the lowest rate for virtual offices at only $80 per month. Perhaps surprisingly, Washington, D.C. has been consistently the most affordable market in terms of this type of coworking membership. Denver and Brooklyn are the only other markets to stand below the $100, more specifically, at $99/month for a virtual office.
Some markets also experienced significant price drops Q-o-Q. For instance, in Phoenix and Philadelphia virtual offices dropped by $64 and $59, respectively.
Conversely, virtual offices in New Jersey and Chicago were the most expensive in the country, standing at $210 and $205, respectively, at the end of Q3. But, the highest price increases in the span of the last quarter occurred in Atlanta (a $32 hike in price to reach $179) and in Chicago (a $16 increase).
Open Workspaces
In markets such as Manhattan, ($299), Brooklyn ($277) and Washington, D.C. ($249), the monthly rate for open workspaces is significantly higher than the national median of $150 (almost double the rate in Manhattan’s case). Even so, nine of the top 25 markets log prices below the national median with New Jersey, Philadelphia, Phoenix and Orange County all boasting a median price of $119 per month for open workspaces.
Yet, during Q3, the highest price surges for this type of coworking membership were registered in (perhaps surprisingly) Minneapolis-St. Paul ($50 more to reach $199 per month) and Washington, D.C. (up by $49 since Q2 to now stand at a monthly rate of $249).
On the other hand, some markets saw notable price reductions in terms of open workspaces. The most significant (down $74) was in San Francisco, which went from $299 per month in July to just $225 at the end of the third quarter. Further south, Orange County also dropped its open workspace rate by $68 from the previous $187, as did Dallas-Fort Worth. In the latter, the coworking membership is now on par with the national median after dropping $48 from $198 in Q2.
Dedicated Desks
The most affordable dedicated desks in the country are found in Indianapolis, where the $209 monthly rate is significantly below the national median of $300. Similarly, Raleigh-Durham ($263) and Salt Lake City ($269) are the only other markets standing below the $270 mark. Not to be outdone, five other locations — DFW, Chicago, Atlanta, Phoenix and Houston — also boast more affordable rates below the national average.
At the other end of the spectrum, dedicated desks in Manhattan go for $510 per month — more than $200 more than the national rate — while the same coworking subscription stands at $450 in San Francisco.
Interestingly enough, Manhattan’s pricey rate is even after a $10 price drop since Q2. That’s the same reduction registered in Atlanta, which now logs a $279 monthly rate for dedicated desks. For comparison, other markets — like LA and D.C. — increased their subscriptions by $25 and $24, respectively, in the span of a quarter to land at $375 and $364. Likewise, Boston is another market where dedicated desk subscriptions saw a $24 surcharge to reach $399 per month.
Leading Markets by Number of Coworking Spaces
LA, DFW & Manhattan Still on Podium, Brooklyn Only Market to Decrease Inventory in Q3
The three leading markets with the highest numbers of coworking spaces remained the same in Q3 as they were in the previous quarter: Los Angeles still leads with 292 spaces after adding 13 more to its total inventory during the last three months, while Dallas-Fort Worth (DFW) held onto the runner-up position it gained during Q2. Specifically, DFW reached 279 flex workspaces after a slight 3% growth in inventory, while Manhattan — the long-time national leader — remains in third place with 275 spaces after adding 11 more locations in Q3 (or the equivalent of a 4% increase in inventory).
Rounding out the top five MSAs with the most coworking spaces are, once again, Washington, D.C. with 266 shared workspaces (3% growth Q-o-Q) and Chicago with 255 (5% increase).
However, the most significant surges in inventory were seen elsewhere. Namely, Nashville achieved an impressive 24% surge in coworking supply after going from 90 spaces in Q2 to 122 at the end of Q3. To the north, half of that growth rate (12%) was registered in Indianapolis, which grew its total inventory to 85 spaces from the previous 76.
Notably, the only market among the top 25 to decrease its number of coworking spaces this quarter was Brooklyn, where a minor 3% decrease took place for the equivalent of three coworking spaces (from 80 in Q2 to 78 now).
Leading Markets by Square Footage
U.S. Adds Almost 5M Square Feet in Q3 as 80% of Leading Markets Gain More Coworking Ground
Nationally, the total square footage attributed to coworking spaces grew by another 5% in the last quarter: it now claims a total of 133,507,623 square feet (up from the previous 127,671,340 to represent almost 5 million square feet added in the last three months).
Naturally, after seeing the highest surge in coworking inventory, Nashville also leads in terms of total square footage growth with a 13% rise in surface covered by flex workspace. The metro area went from 1.84 million square feet at the end of Q2 to 2.09 million square feet as of Q3. A similar increase in surface area (12%) was also logged in San Francisco, where 3.62 million square feet is now attributed to coworking spaces, as opposed to 3.23 million back in July.
Of the 25 leading markets, only five decreased their total coworking surface during Q3. The most significant drop of 17% was in Brooklyn, which took the market from a previous 2.36 million square feet down to 1.96 million. Nearby, Manhattan also lost 6% of its total surface, although it remains the top market with the most coworking ground at 11.16 million square feet — almost double that of the runner-up in this category, Chicago. Other MSAs where the total coworking ground decreased were Austin (-4% to a current 1.65 million square feet); Denver (-3%); and DFW (-2%).
Average Square Footage Continues to Decrease in 15 of 25 Markets, Most Drastic Declines in Brooklyn, Manhattan & Austin
Although total national coworking square footage continues to increase, the average size of individual coworking spaces in most markets is dwindling, thereby reflecting the same trend observed during past quarters. This is likely due to the rising focus on smaller coworking spaces that may be more focused on communities and niche audiences.
Accordingly, in Q3 of 2024, the average coworking square footage at the national level stood at 17,711 million after a slight 2% decrease from last quarter, when it landed at 18,133 million square feet. Then, this quarter, only 10 of the top 25 markets registered increases in their average square footage covered by coworking spaces.
Consequently, the largest coworking spaces as seen through the average square footage can now be found in Manhattan (40,597 square feet); San Francisco (29,397); and Chicago (26,068). Moreover, San Francisco registered the highest gains in terms of coworking surface as a result of its rise in total square footage. Here, the average square feet per space grew by 9% since Q2.
Then, at a distance, the New Jersey market increased its average surface by 4% Q-o-Q to now log 16,909 square feet per space. Similarly, other increases above the 1% growth rate were registered in the Bay Area and San Diego (2%), as well as in Washington, D.C. and Raleigh-Durham (1%).
Conversely, Brooklyn was the MSA with the most drastic loss in average coworking surface with a 15% drop since Q2 to now settle at 25,066 average square feet per space this quarter. Neighboring Manhattan also decreased in this metric by 10% Q-o-Q to now land at 40,597. The same 10% loss was noted in Austin, Texas, where the average square footage per coworking space stood at 18,767 at the end of Q3.
Distribution of Top Coworking Operators
HQ Remains Operator with Fastest Expansion, Adding 10% More Spaces in Q3
The top leading coworking operators in the U.S. market remained the same as they were in Q2 of 2024 — Regus, WeWork, Industrious, Spaces and HQ. All of them logged the highest numbers of coworking spaces both on a national level (a cumulated, quarter-over-quarter increase of 3%) and within the top 25 markets analyzed (a cumulated, quarter-over-quarter increase of 1%).
Following last quarter’s trend, the most impressive growth in portfolio nationwide was attributed to HQ, which added 10% more spaces across the U.S. in Q3 alone to now reach a total of 236. The operator also had 5% more locations among the leading markets, now amounting to 105.
At the same time, Spaces grew its U.S. inventory by 7% after adding nine more flex workspaces in Q3 to a total of 147. In particular, in the top 25 markets, Spaces now checks 113 coworking locations for a 5% Q-o-Q growth.
In the same way, the leading operator in the country, Regus, registered slight increases in inventory during Q3 — 2% nationwide (to reach 998 spaces) and 1% among the top MSAs (580 spaces).
Coworking Niche Begins Maturing with Entry of Coworking Networks
As with most emerging sectors, the coworking industry has also been subject to strategic partnerships and consolidations, meant to bring disparate brands together under a single umbrella and cater to a large and diverse range of users.
Recently, three established coworking brands — Office Evolution, Venture X, and Intelligent Office — have come together to form VAST Coworking. The network currently stands at a total of 174 spaces across the U.S. This type of consolidation is a solid reinforcement of the coworking industry's prominence and popularity, among businesses and workers alike.
Methodology
- To compile this report, we used proprietary data from CoworkingCafe to determine the number of coworking spaces per market, as well as the total square footage and leading operators.
- The study relied solely on the listing data available on CoworkingCafe as of October 2024.
- The top 25 markets analyzed were established by our sister company Yardi Matrix and were ranked based on allocated square footage.
- In terms of pricing, we looked at the national median starting prices per person per month for virtual office, open workspace and dedicated desk coworking subscriptions.
Fair Use & Redistribution
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