Co-working and live-work spaces are turning Austin's office environment on its head, industry experts say
By Marie Albiges
Dozens of co-working spaces have opened throughout Central Austin since David Walker said he and his partners first brought the concept to the city in 2008.
After increases in rent forced him to close his East Austin co-working space, Conjunctured, Walker-who has since helped launch a global co-working consulting company-said he saw what Austinites were missing: alternative workspaces, or places where communities of like-minded people could gather to work and exchange ideas in productive environments.
"[The growth of alternative workspaces] is a trend," he said. "It's not a fad; it's not going to go away."
Although the trend of alternative workspaces is growing rapidly in Austin, what does this mean for the traditional office space and the work culture that comes with it?
Clay Spinuzzi, a University of Texas professor of rhetoric and writing who studies workspaces, said almost anything can be considered an alternative workspace.
In Austin, an alternative workspace exists for nearly every industry-from the specialized co-working incubator-accelerator Capital Factory, which connects entrepreneurs with investors to grow their businesses, to Soma Vida, a "wellness-inspired co-working movement."
So-called live-work spaces, such as the 704, Camden Lamar Heights and the Mueller Shop Houses, blend the work-life balance by offering office or commercial space on the ground floor and living space above for the business owners.
Certified Public Accountant Dwayne Anderson, who gave up his office in the Scarbrough Building at Congress Avenue and Sixth Street for a live-work space at Camden Lamar Heights, said he was able to pay roughly the same price for an 800-square-foot office and the apartment above it and no longer worries about traffic or parking.
Adding a unique wrinkle are two entrepreneurs aiming to turn unused restaurant space into co-working areas during the day when the restaurants are closed.
Founders Christa Freeland and Jacob Morin launched Switch Cowork out of restaurateur Bridget Dunlap's Burn Pizza+Kitchen in late October and hope to expand to more restaurants in the future. Switch Cowork moved to Dunlap's new restaurant Trackside in mid-November.
What is the co-working* model?/The Live-Work experience**
Austin-based co-working consultant David Walker defines co-working as workspaces creating a framework that allows people from different industries and occupations to connect with each other and grow professionally and socially. According to Walker, the city of Austin is one of the national leaders of the growing trend.
*Statistics are based on 1,679 responses from a 2015-16 global survey
The live-work concept allows tenants to lease business space on the ground floor and live above it. Some live-work spaces, such as the Mueller Shop Houses, have two stories of purchasable living space, and others, such as North Lamar Boulevard's Camden Lamar Heights, have one story of living space.
**All statistics are based on the Mueller Shop Houses
At ATX Factory's 12,000-square-foot urban warehouse space on the east side of Austin, community is key, according to owner Vijay Mehra.
Complete with an open-floor concept, massage chairs, privacy booths, conference rooms, a yoga and meditation space, food trucks, a bonfire pit and free beer on tap, the co-working space is advertised as a "community of creators, innovators and food truck enthusiasts."
Mehra said he wanted to establish a "work hard, play hard" mentality with ATX Factory.
He said this mindset allows his members, which span various industries, to "mix up their day" and interact with people from different backgrounds.
Walker said co-working spaces with these types of seemingly distractive amenities are actually more productive than a traditional workspace.
In traditional offices, workers feel disempowered, uninspired and "like their own natural rhythms of work are not being given permission to exist" because of a "butts-in-seats" mentality, he said.
In co-working spaces, Walker said people are feeding off each other's energy and productivity, and members are inspiring one another with their successes. The spaces are designed specifically to be productive, he said.
"When you go into a co-working space, you own your day," Walker said.
Walker called alternative workspaces the "biggest disruption" the commercial real estate market has ever experienced.
He said in the traditional office model, companies lease space long-term and account for anticipated growth, meaning the entire office might not be utilized in the early stages of the company.
Today, however, that model has been shaken by alternative workspaces, which lease by head rather than by square footage, Walker said.
He said landlords are more likely to lease to established co-working companies, for example, such as WeWork, which has offices across the U.S. and in 12 countries.
Matt Wilhite, vice president for real estate company Aquila Commercial, said he encourages well-established companies to consider alternative workspaces as a viable option and tries to change their perception that co-working is just for millennials working in tech startups.
"Work is not a place you go anymore, it's something you do. And you can work anytime, anywhere."
-David Walker, Austin co-working expert
"A lot of my clients don't know what a well-designed co-working space can look and feel like," Wilhite said.
Wilhite and Walker agree despite the increase in Austin co-working spaces, traditional offices are still in demand. Wilhite said the move to a traditional office space is being delayed while companies grow within co-working spaces.
Most of the time, Walker said a company grows too large for a co-working space and moves into a traditional private office, but some independent freelancers will remain indefinitely.
He said landlords are also starting to design their office buildings for the future of work by upgrading to more "millennial-ready" amenities and creating open floor plans.
"Work is not a place you go anymore, it's something you do. And you can work anytime, anywhere," Walker said. "In this anywhere, anytime environment, it seems the living is becoming a part of the working."
As the city of Austin looks to rewrite its land development code-a process called CodeNEXT-Jorge Rousselin, project manager for the code rewrite, said he is thinking about how to create an inviting atmosphere for such spaces.
"We're wanting to expand the availability of building types so that there's a greater choice when it comes to looking at various land uses," he said.
He said he wants to offer businesses a variety of options for creative spaces that would be available without additional city approval.
"[Cities] are seeing [co-working] as a hub of activity for small business owners to create innovation districts," Walker said, explaining cities with these already-established spaces are less likely to change zoning and permitting laws that might hinder co-working.
The trend of alternative work spaces in Austin is not slowing down anytime soon, Spinuzzi and Walker said.
"Austin is pretty much the quintessential city for co-working," Walker said.
He said he anticipates more specialized co-working brands opening because it will become too difficult to compete with larger general co-working operators such as WeWork.
He said he also predicts more traditional commercial real estate owners will experiment with their office building designs by adapting to the demand for more sharable and productive community space.
"Co-working has kind of created a new baseline for the modern workplace," he said.
This story has been updated to reflect the location change for Switch Cowork.