When thinking of what a future office would look like, virtual reality, high-tech gadgets and Iron Man-inspired computers would pop into most people’s minds. It is doubtful that people would have imagined the office of the future with colorful walls covered in pop art, Acapulco chairs, ping pong tables and a happy hour. Perceptions of the future of corporate real estate are changing rapidly along with the incorporation of more and more millennials into the workforce.
LinkedIn and other business news outlets seem to love millennial-themed articles discussing how they think and why they are different. But whether we like it or not, the Mexican market will be led, designed, built and managed by millennials very soon. By 2020 they will occupy more than 35 percent of the global labor market.
- As of 2017, there are more than 30 million millennials in Mexico, representing one quarter of the country’s population.
- There are more than 3.9 million micro-companies in Mexico, representing approximately 97 percent of the market according to INEGI.
- 7 million freelancers work in Mexico, of which 3 percent have a coworking space according to Regus.
- By 2020, 80 percent of work will be carried out in non-traditional office spaces such as coworking spaces according to Citrix
Millennials are driving the market of the future, preparing the shift to Gen Z’s high demands. The key to creating successful real estate developments is by satisfying the needs of this disruptive generation. According to a study from the University of Waterloo, millennials are earning less than their parents did at the same age. Millennials are spending more time and money on their education, leaving them with debt and a slower start in their careers. 2017 will be a challenging year, with the changing economic and political landscapes creating uncertainty and market volatility. As their disposable income dwindles, millennials are looking for new ways to save money and real estate is no exception. Shared offices and coworking spaces provide cheaper alternatives for companies to house their employees and optimize their costs. These concepts fit many companies into one office, allowing for rotation and the efficient use of all resources, plus no need to purchase furniture.
But should the future of offices be more than just the integration of more colors and bean bags?
Joaquin Diez-Canedo, architect and architecture historian from University College London said it is more practical than this. According to him, it gives thousands of MSMEs a chance of being located in an office space that perhaps they may have never been able to afford in central locations. These spaces are creating ecosystem where smaller companies can share their ideas and continue taking advantage of opportunities within the market. With such high rent prices in AAA buildings, many MSMEs are forced to take refuge in offices far away from public transportation and even use apartments as offices.
Coworking should not be limited to consultants, lawyers and other service providers. This week Fibra Upsite debuted on the BMV on June 21, looking to give industrial SMEs a home. Fibra Upsite wants to develop 17 industrial properties in the next two years in the northern, central and Bajio regions. These 17 properties will be for industrial coworking as well as traditional spaces in five different industrial parks. This is the first industrial Fibra with a coworking vision and it has a large market to cater to. Rodolfo Balmaceda, CEO of Fibra Upsite says that the Fibra’s objective is to serve over 490,000 manufacturing companies in Mexico. Innovation within the real estate financial market and disruption in design in both industrial and corporate will adapt to the ever changing market and boost the development of Mexico’s SME sector.