Stock - Co working
It's not only tech and project-focussed freelancers that are fuelling the demand co-working spaces in the UAE. Even bigger businesses are finding utility in this concept. Image Credit: Letswork

Dubai: Co-working spaces in Dubai and Abu Dhabi are building up some serious growth nearly five years after this concept was mooted as the next big trend in the UAE property market. These days, there are co-working spaces fitting every requirement and budget, with the top-of-the-line ones leasing for well over Dh150,000 for a year’s worth.

The UAE co-working boom is not driven principally by freelancers or gig workers, requiring just a ‘hot desk’ to do their work. Clients include bigger enterprises, who could be waiting for a permanent address or opted for a bare-minimum working team for now, startups and others.

Such has been the demand that co-working spaces – where tenants have their own desks and access to other needs, but share the wider space with others – that Dubai is seeing a significant addition in new capacities.

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Earlier this year, the Dubai CommerCity, the digi-commerce-focused free zone, partnered flexible workplace firm IWG to introduce Spaces CommerCity. Amna Lootah, board member at Dubai CommerCity, had said: “The introduction aims to foster a culture of flexible work and support digital commerce growth in the UAE.”

A home-grown marketplace for co-working spaces, Letswork launched in 2018 with zero members and now has over 55,000 users in the UAE, Saudi Arabia, Bahrain, Spain, and Portugal. The company’s founders, Omar Almheiri and Hamza Khan, have more ambitious plans in store.

By capitalising on demand for ‘work from anywhere’ trends, Letswork has partnered with 400 outlets to create dedicated co-working spaces, including at hotels, cafes, business centers, and studios. Out of the 400, around 300 are in the UAE.

Unprecedented demand

It was around 2018-19 that co-working got some serious attention from investors, helped by the entry of international brands into the marketplace. Before that momentum could build, Covid intervened and demand stalled for around two years, according to industry sources. Matters were not helped by the work-from-home options at the time, with client meetings all transitioning to Zoom or teams or any other virtual platform available.

Cost-effective ‘credits’

Now, co-working spaces are seen as significantly reducing capital expenditure associated with office rent. Letswork, for example, operates on a credit-based model, allowing individuals and companies to purchase redeemable ‘credits’ based on their work preferences and the level of support and add-ons they desire in the workspace. Credits are a flexible and affordable way to work from cafes, hotels and co-working spaces across town.

Individuals can purchase a day pass for Dh25, or companies can pay up to Dh3,850 for 1,000 ‘team credits’. The price per credit is Dh4.8, allowing workers a certain number of monthly check-ins depending on the packages purchased.

Letswork Founders
In 2019, Omar AlMheiri and Hamza Khan teamed up to start Letswork.

For example, Letswork charges Dh120 for a 25-day pass for individuals and Dh425 for 100 team credits (for a team of 2-10 people). Depending on usage, this provides clients access to Letswork partner spaces, and lease terms are customisable to the user’s requirement. (Subscribers are also offered unlimited tea and coffee, among other perks…)

Individuals and companies can also purchase packages directly from space providers instead of using the marketplace.

It’s all driven by payment flexibility

Similarly, The Bureau, a co-working space exclusively for women, charges Dh120 for a day pass, Dh950 for membership and Dh3,000 for private office rentals. Nasab by Koa’s co-working offerings are priced at Dh140 onwards, while Nomad offers flexible options for freelancers. One can choose a hot desk package for Dh1,000 for 10 days a month, a resident package for unlimited access at Dh1,500 a month, or private suites for teams of 2-12 people starting at Dh2,000 per month.

Membership prices for Modern Working in Business Bay start from Dhs2,400 monthly for co-working and Dhs5,000 for private offices. Day passes at Abu Dhabi’s Cloud are priced at Dh120 per person.

Commercial leases

Companies have also begun providing long-term lease options to their users. “New entrepreneurs and companies have begun to question why they should commit to lengthy leases for traditional offices in prime locations like Sheikh Zayed Road,” said Hamza Khan, Letswork’s Chief Executive.

Instead, companies are investing in fully furnished, flexible, plug-and-play solutions that save them from the capital expenditure for rent.

In response to this demand, we now facilitate long-term rentals through partnerships with brokers

- Hamza Khan

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“Approximately two-thirds of our revenue is generated from subscriptions (Letswork credits), while the remaining is bookings,” said Khan. “This encompasses both short-term and long-term rentals, including meeting rooms and offices.

Letswork’s growth plans
Having secured $2.1 million in a December seed round - including from 500 Global, The Space in Saudi Arabia, DTEC Ventures in the UAE - Letswork is expanding the co-working theme to Saudi Arabia, Egypt, India, and Pakistan. Before the seed round, all company funding was bootstrapped.

“We aim for substantial growth, especially after our recent entry into Saudi Arabia,” said Hamza Khan. The company also acquired Portugal-based Krow in February last year.