How has the coworking market changed over the year? Highlights from the UCA research

Ukrainian Coworking Association has investigated how the coworking market has changed during the full-scale war. They shared the results with us. Here are the main conclusions.

What happened

Coworking Association of Ukraine conducted a study to determine the state of the coworking market during the full-scale war waged by russia against Ukraine. UCA interviewed 40 operators and owners of workspaces (79% were representatives of network coworking spaces), as well as 630 clients from various business sectors.

The geography of the study covers 13 cities: Kyiv, Lviv, Uzhhorod, Irpin, Zhytomyr, Ivano-Frankivsk, Khmelnytskyi, Ternopil, Kremenchuk, Kropyvnytskyi, Odesa, and Chernivtsi. Here are the key points from the study:

• 53% of respondents who closed their coworking spaces have already resumed work.
• 50% said they closed due to lack of profitability, 30% – due to temporary occupation or damage to the location.
• 10% of respondents suspended operations to expand their locations, and the same number failed to reach an agreement with the owners of the premises.
• 6 coworking spaces closed completely in Kyiv, Irpin, and Odesa.
• When asked whether they have plans to expand their networks in 2023, 50% of coworking operators who participated in the survey chose the “yes” and “no” options.
• 5-10% — the average price reduction for coworking spaces in Kyiv, and 6-14% in other regions.
• The highest average occupancy rates of coworking spaces during the year of full-scale war were observed in the fourth quarter of 2022. In the first three months of 2023, this figure fell to 61.8%.
• 45% of coworking clients cite the availability of a shelter/stable internet/electricity as the main factor for continuing or starting work in a coworking space. For 28% of respondents, it is the ability to communicate/collaborate within the coworking community. 22% named the level of service and location as the determining factor, and 18% — the availability of discounts.
• Almost 60% of coworking residents are from the IT and technology sector. Marketing is in second place with about 20%.

The main factors for further expansion of their coworking networks are:

• stable occupancy of locations at more than 80%;
• economic recovery to pre-war levels;
• favorable sublease terms;
• complete end of war in Ukraine.