Why do they go to the peripheries? Studying the relations between the real estate market and coworking spaces in the peripheral areas of Germany
Journal of Property Investment & Finance
ISSN: 1463-578X
Article publication date: 13 April 2022
Issue publication date: 3 August 2022
Abstract
Purpose
The study was designed to investigate the bidirectional causation between the real estate market characteristics (residential property prices/rents (including PTR), office rents) and the rise of coworking spaces (CSs) in the peripheral areas of Germany.
Design/methodology/approach
Based on the desk research, the authors constructed their own database of 1,201 CSs. The authors gathered data on the residential and office prices and rents on a district level. To identify real market differences between districts with and without CSs, the authors applied the t-test for independent samples.
Findings
The second-highest number of CSs were found to operate in the office market peripheries. This phenomenon should be explained by a search for lower office rents, which CSs seek. Most CSs in the peripheral areas of Germany were only recently established in tourist-oriented regions in the south and north of Germany. In this paper, the authors confirmed that the strength of peripheral CSs lies in the hybridity of their operations: for the majority of CSs, running a CS is a non-core business. The authors argue that the role of CSs is rather limited in attracting real estate investors and boosting the real estate market in the peripheral areas of Germany.
Practical implications
The research shows that peripheral locations are attracting CSs to significant extent. The study shows that CSs can be part of corporate real estate or workplace strategies. As the majority of peripheral CSs are located in tourism areas, the subletting of vacant spaces could be a lucrative business model for hotels, particularly in the times of pandemics. Therefore, further research should focus on the role of tourist areas in the implementation of CSs model.
Originality/value
The focus of this study (CSs in peripheral areas) is original. Additionally, applying the real estate perspective to study the location of CSs is novel as well.
Keywords
Acknowledgements
Funding for this study has been provided by the Polish National Science Centre under the PRELUDIUM BIS 1 scheme, grant no. 2019/35/O/HS4/00861. The paper has been supported by COST Action CA18214 “The geography of New Working Spaces and the impact on the periphery”, which is funded by the European Union https://www.cost.eu/actions/CA18214) by the STSM research stay of Thomas Vogl at the Jagiellonian University in Krakow. The support of Karolina Małochleb (Jagiellonian University) in the construction and editing of the figure is acknowledged.
Citation
Vogl, T. and Micek, G. (2022), "Why do they go to the peripheries? Studying the relations between the real estate market and coworking spaces in the peripheral areas of Germany", Journal of Property Investment & Finance, Vol. 40 No. 5, pp. 479-492. https://doi.org/10.1108/JPIF-11-2021-0095
Publisher
:Emerald Publishing Limited
Copyright © 2022, Emerald Publishing Limited