David, You can't use the general rule of 10% of your income being in rental income since this is your greatest expenses compared to most businesses where employees are their biggest expenses (excluding certain special manufacturers). You have to ask yourself a few questions when developing the business plan and determining the final price.
Do you plan on coworking suport yourself or any full-time staff member? Do you want this to be a profit venture? What is the market rate for coworking in your area and what is the market rate for space in the area your looking into? If you plan on having the space sustain a FT staffer then the size of the space and lease both need to be carefully considered. With a FT staff member the space needs to be larger, at least 2200 sq. ft., and a favorable rate not exceeded $15 sq. ft. (this will change based on cities). Since most expenses are fixed the larger the space the larger the possibility of profit. This is mostly because you need to have a certain degree of shared space for hallways, bathrooms, kitchen, lounge area no matter the coworking space size. Once those are covered then the work spaces are considered and you can set the number of desks.For a point of reference I have 23 places for people to work at and I'm using around 2300 sq. ft. However, I'm adding 15 more work spots soon because I have a large empty room I'm looking to grow into. I won't need to anymore lounge space, etc. because I have enough already. Location is key for lease rates and marketability. Creative Density is located in downtown Denver but I'm 9 blocks from the city center and the high rises. My rent is 1/3 cheaper because of it and I'm in a neighborhood that many coworkers are at. I did a survey for people to vote on which neighborhood in Denver they would a new coworking facility in. If I was just a 10 minute walk away with a $18/sq ft lease I don't think I could be a sustainable business while supporting a staff member without taking on much greater risks. I hope this helps. Craig @CreativeDensity On Jul 29, 6:24 pm, David Clinton III <d...@me.com> wrote: > Hey All, > > I’ve been lurking in this group for a while, listening, learning, and > researching. Thank you all for your immense insight and knowledge! > > I’m hoping to start a Coworking space in Coeur d’Alene, Idaho. From what I > can tell, there may be one in Spokane, WA (45 minutes away), but otherwise, > the nearest are in Seattle, and Boise. There seems to be a big enough > population of “regulars” working in coffee shops, they may just appreciate a > space of their own. > > Anyway, as I’m looking at spaces, I’m a bit overwhelmed thinking about > numbers. In some industries they say you can only afford a lease that costs > 10% of your company income. Does anybody have an idea what sort of > percentage would work like this in the Coworking world? What do some of your > rent: income ratios look like? I can’t imagine overhead would be that much > in this business, but before getting started and bombing, I really do want to > at least break even. > > Thanks, > > -- > David Clinton III -- You received this message because you are subscribed to the Google Groups "Coworking" group. To post to this group, send email to coworking@googlegroups.com. To unsubscribe from this group, send email to coworking+unsubscr...@googlegroups.com. For more options, visit this group at http://groups.google.com/group/coworking?hl=en.
