'24-hour co-living office' and its implication to Hong Kong's co-working space development in a post-COVID era

Abstract

The rise of co-working spaces has completely reshaped how offices should look in the past decade. It encourages the concept of sharing workplace with professionals from different companies and industry backgrounds. After the pandemic, the evolving development of the co-working industry has given rise to a new business concept known as 24-hour co-living offices. It integrates both living and working functions and users can enjoy private leisure and entertainment life as well as professional workplace support within one single property. This presents an ultimate change which works in the opposite way as traditional offices and presents a new and innovative operation strategy for working spaces. However, this concept has not been adopted in Hong Kong until now. Therefore, it is necessary to explore whether this concept presents an effective alternative in dealing with the housing problems in Hong Kong. This research explores the new concept of 24-hour co-living offices and their potential for the future development of co-working spaces in Hong Kong after the pandemic. With the use of a qualitative research approach including literature reviews, interviews and case studies, this study aims to investigate whether co-living offices can act as sustainable business models in Hong Kong’s highly populated urban environment. To attain these objectives, the new trends in the co-working industry will be examined. Key drivers and obstacles for co-living office development in Hong Kong will also be analysed to give implications for the business model of its development. The findings indicate that demands for co-working space users have significantly changed since the outbreak of the pandemic. The increasing adoption of remote working modes increases the demand for hybrid spaces. Users now tend to look for flexible working spaces which provide support in virtual collaboration tools and have a high engagement in maintaining the health and wellness of users. Insights gained from interviews and case studies also show that the development of co-living office models is mainly driven by its low operation costs and high land use efficiency. User convenience can be greatly improved by integrating work and live functions and improving mental health and quality of life. This offers a promising solution for young professionals, startups and business travellers in high-density areas. However, this study also identifies certain obstacles. High development costs and regulatory constraints make mixed-use approvals very difficult in Hong Kong. The uncertainty in market acceptance of co-living office models also raises investment risk in certain developments and lowers developers’ incentives. Despite the current low incentive for co-living office development in Hong Kong, this study presents practical suggestions for sustainable business models in the potential implementations of co-living office models. Co-living office operators should present clear target users and conduct detailed market analysis and positioning to avoid rapid scaling. The adoption of modular and adaptable designs with the use of tiered leasing can also help attain high occupancy rates and achieve sustainable financial revenue. It is also believed that partnering with other service providers can help reduce daily operational costs by outsourcing different services and collaborating with policymakers can push for zoning flexibility and overcome regulatory hurdles. Hence, promoting the sustainable development of co-living offices in the local real estate market in Hong Kong. All in all, although co-living offices may not entirely replace traditional offices, they present a practical and timely advancement of co-working spaces in Hong Kong. This study fills the research gap in the lack of studies on co-living office developments in Hong Kong, providing a detailed implication for their potential in the local market. It also provides a basis for further research into the financial modelling and long-term social implications of hybrid space development, aiming to redefine urban workspaces in the near future.