The Bright Future of Co-Working in Africa

Over the past few years, Africa has witnessed a dramatic increase in the adoption of co-
working spaces. As of 2020, Nigeria had 60 co-working spaces, the highest number in Africa,
followed by Egypt (59) and South Africa (58). These countries present a dynamic
entrepreneurial environment and have improved their startup ecosystem by not only
offering spaces to work but also by reducing financial and environmental barriers to
entrepreneurship. Although the ongoing pandemic has dealt a huge blow to several
industries, including co-working spaces, the smooth transition to remote working reflects
the ease with which many businesses can shift environments. Thus, a case to be made is
that the future of office or commercial spaces in Africa will be a juxtaposition of “remote
working” and “work from office” with co-working spaces bridging the gap.

• Calibrated shift towards Flexible working

It is not surprising that many companies are planning to adopt a hybrid approach to where their
employees work from in 2021. In a recent Slack survey, over 72% of workers said a hybrid
remote-office model would be their ideal work situationi. In the workforce sentiment survey by
CBRE, 43% of the respondents said they would consider working from a company provided
location nearer to their homeii. JLL believes that the need for pre-built offices, lease flexibility,
and workplace mobility options will continue to increase in the near future. The adoption of
flexible work spaces in EMEA has seen gradual recovery from the second half of 2020 even amid
the pandemic situation.

Exhibit 1- Source: JLLiii

• Entrepreneurship and the rise of tech-hubs

From 2015 through 2020, the number of African tech startups receiving financial backing grew
at 46% annually— six times faster than the global average—according to the venture capital
firm Partech Partners.

Exhibit 2- Source: BGCiv

Though startups may have the finances and resources to build their own offices, the costs of
starting up can be expensive in developing countries. Coworking spaces can lower overheads
for many small businesses, startups and freelancers, offering flexible contracts and top-notch
office amenities without long-term commitments in an uncertain market.

• Expansion in Africa’s working population

The shift to alternative, hybrid, and flexible work spaces will be driven by the entrance of the
Gen Z population into the workspace. Members of Gen Z are true digital natives - from their
early youth, they have been exposed to the Internet, social networks, and mobile systems.
Accounting for ~36% of the global workforce this year, this group of digital natives expects the
modern workplace to be flexible and support remote work initiatives. It is estimated that 60%
of Africa’s 1.2bn population is under 25 yearsv. This makes Africa the ‘youngest’ continent with
regard to its population average. This exceedingly means that Africa has the potential to
spearhead the widespread shift and sustenance of this “new” way of working.

With a more connected and innovative economy growing rapidly in Africa, coworking is proving
to be an essential tool for businesses and the workforce alike, allowing them access to valuable
resources, networks, skills, and job opportunities. The Future of Coworking in Africa appears
bright with the new-age economy being the chief driving force of the rise in its adoption.

Sources:

i https://www.iol.co.za/business-report/companies/five-key-working-trends-for-2021-956411fb-64c3-42f6-
99fd-17b1b595bc1d
ii https://www.cbre.com/thewayforward/Workforce-Sentiment-Survey?article=%7B9DD4F9D7-60E8-4B40-

B4E8-4357ECD0A9E0%7D
iii https://www.us.jll.com/en/trends-and-insights/research/the-impact-of-covid19-on-flexible-space
iv https://www.bcg.com/publications/2021/new-strategies-needed-to-help-tech-startups-in-africa
v https://www.idgconnect.com/article/3578009/african-boardrooms-should-get-ready-for-gen-z.html