IKEA: Your New Office Away From Office
Step aside coffee shops and traditional offices, there's a new hotspot for hustlers and creatives alike: IKEA – the Swedish furniture giant that's now redefining coworking spaces.
IKEA opened its first coworking space on the third floor of the IKEA on Market Street in downtown San Francisco.
The space is 46,470 square feet and is called Hej! Workshops.
The coworking membership starts at $399/month, priced above WeWork’s All Access passes, which will run you $199/month (180 locations) or $299/month (500 locations).
The space includes standard coworking amenities like an open workspace, phone booths, private conference rooms, and fast Wi-Fi.
Now, IKEA wants to make their new coworking spot a destination. Somewhere you can come all day.
They plan to add, per The SF Chronicle:
- A food hall so you can enjoy breakfast (included in the membership) and fresh options for lunch and dinner
- A gym or fitness tenant so you can get a sweat in before or after work
So, will it work?
Coworking spaces are challenging businesses because they require a lot of upfront capital to lease a space, and they are likely to lose money until they recruit enough members. WeWork’s financials showed us you need around an 80% occupancy rate for a location just to break even. IKEA may be uniquely capable of executing this type of business because they plan to pair their coworking locations with IKEA furniture stores, which drive serious foot traffic. The IKEA furniture store on Market Street that the coworking space sits above reported 120,000 customers in the first 30 days of opening, per The SF Chronicle. This is really impressive, even more so considering that the location on Market Street is regarded as a “dead spot,” with several major retailers leaving in recent years, including Nordstrom, Old Navy, and Office Depot.
All that foot traffic provides a buffer to the expensive customer acquisition costs that pose a serious challenge to any stand-alone coworking spaces.
I imagine it will still be a challenging endeavor, but as an LA native who has fond memories of visiting IKEA with my family as a kid, I can’t wait to spend some time there.
