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Neil Usher: Paradoxically Speaking

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The man who will remake coworking

Dan Cohen is founder of Purpose Group, which operates affordable, flexible and productive workspace in London buildings that would otherwise remain vacant, unused and unloved. Unlike almost everybody else in the coworking world, he’s poised to expand.

04/11/2020 3 min read

Purpose, founded by Dan Cohen, specialises in an occupier sector that WeWork and its peers largely bypass: genuine creatives. Purpose Group tenants throughout its 320,000 sq ft portfolio are more likely to be fashion designers than financial planners, sculptors than strategists and painters than planning consultants, although financial planners, strategists and planners are among the tenant mix.

What they have in common is that these are businesses with a budget, and a serious purpose (as the group name suggests), and the use of a complimentary beer tap and some super-expensive sofas comes low on their list of must-have priorities.

Words: David Thame


Purpose started a couple of years ago with a 30,000 sq ft office building in London Bridge that was earmarked for redevelopment. The business has now expanded into three new venues in Clerkenwell, Bethnal Green and King’s Cross and will soon be making a splash in Hackney Wick and Tottenham. If predictions about the importance of neighbourhood are right, and more workspace will be needed outside traditional central business districts, Purpose provide a magnificent example of how this might work.

And the key discovery made by Dan and his team is that money matters: in the coworking market of the future, transparency around pricing will matter more than justifying overpriced serviced offerings which, they believe, was typical of the overcooked pre-coronavirus coworking market. The woes of WeWork simply make the point, Dan insists.

‘Yes it has obviously been difficult for the coworking sector, but the difficulty only emphasises the need for what my business does, which is truly affordable flexible floorspace, aimed not just at well-funded start-ups, but operators in all categories.

‘I think, because we cover a broader spectrum of tenants than many coworking operators, we’ve been more resilient during the pandemic. Our occupiers need the physical space we provide more than in some other coworking locations. For instance, a fashion designer needs their sewing machines around them.’

This resilience has encouraged them to press on with the 100,000 sq ft third location in Tottenham Hale. ‘We continued marketing during lockdown,’ Dan says. ‘And we found people are much more open-minded about locations that some of the big coworker brands would suggest. So we’ve also opened in Bermondsey, and right now we’re steering clear of central London offices because it is no secret they are struggling.’

Dan says he is being offered sites ‘all over the city and in various different conditions’ and would like to expand to more than 500,000 sq ft in the next 12 months. But he is being cautious about site selection. ‘We’re taking our time to consider how to proceed,’ he says, hinting that landlords are asking (or being encouraged to ask) unreasonably high prices.

‘There’s still a lot of optimism in the agency market,’ he says, gently chiding brokers for the upbeat pricing. ‘There is still some time to go before we can secure the kind of deals we need if we are to grow, because ultimately this is all about pricing, for us and for occupiers.

‘Occupiers are beginning to realise they could spend £150 per sq ft fitting out an office with things they don’t really need, and never have needed, and that they will never get their money back,’ Dan adds, in a final slap at the higher end of the office market.

Yes, Dan would like to work in partnership with landlords in much the way hotel operators work through management agreements, and yes, he’d be happy to explore offering white label office space to occupiers who could brand it as if it were their own. But for now he senses landlords are wary, bruised and sceptical. They have had a tough (often scary) six months when rent payments have trickled in, and they are not in the mood for clever new business arrangements.

Dan thinks that some kind of intelligent risk sharing is the future, with landlords and coworking operators taking a genuine partnership approach. But for now pricing remains the key to the success or failure of coworking. ‘Striving for affordability’ is the issue, he says. Until that striving is turned into market-wide consensus, the coworking sector will always be vulnerable.

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