Onyx Equities’ Jonathan Schultz: Co-Working is Great Opportunity for Landlords
NEWARK, NJ — Commercial real estate in Newark is changing in a lot of ways. In fact, it might even be changing in ways you’ve never heard of. Just look at one of the most interesting – and fast-growing – trends in the office and retail space: co-working. This was a central topic of the panel Newark Office Leasing & Drivers for New Product: Exploring Trends in Occupancy and Unique Demands of Modern Tenants, Moderated by Barbara E. Kauffman, Executive Vice President & Chief Operating Officer of the Newark Regional Business Partnership and featuring input from Jonathan Schultz, Co-Founder and Managing Principal at Onyx Equities, LLC.
“Most of the landlords seven years ago were in denial,” recalled Schultz, after Dayo Adiatu, Community Manager for Launch Pad, provided some remarks about her team’s mission and activity in Newark. “If I would have brought co-working up to any of them, they’d say that, they are never going to survive, that this is a fad. And the one thing that I completely feel, which I have since this started, is that it’s not going away. It’s here to stay. It’s a de minimis part of the market, yet it’s going to be a bigger and bigger part of the market as the years go by.”
“If you believe the statistic, that 50% or 40% of the population will be working for themselves as things automate and AI and blockchain come into play — which, it will — then co-working is going to be a huge part of all of our buildings and all of our real estate thought process,” continued Schultz. “There are many different types. They are a community. They are not a lease. They’re a membership. They’re a feeling.”
Schultz then listed some disruptive names that have stemmed from the gig economy and the Airbnb Effect. “From Notel to SwingSpace to WeWork, which is its own culture, to Industrious, to where it’s more how you can bring in a 6,000 square foot experience from corporate companies wanting to show their wares, to taking short term leases within these locations,” he mused.
“I think why it’s happening is, our world wants to have instant gratification,” asserted Schultz. “And with social media and the internet and all of these platforms, instant gratification is paramount. Flexibility is paramount. And office buildings have never really offered that as easy as some of the other products have. And it’s changing. Tenants would rather sign shorter term leases if they can. So this is an alternative. Not for all of their space. This global thought, that it is going to change everything one way, that never happens.”
According to Schultz, these new disruptive paradigms such as co-working are an amazing opportunity for landlords to have great activation in their buildings. “From venue-ing to events to things that we don’t really want to get involved in day to day,” he shared. “So the better that these companies get, the more well capitalized they are, the more full they are, the more creative they get, the better that we can serve the customers that we are all trying to figure out. I think it’s a great thing. I’m learning as much as I can about every one that is out there.”
Schultz then ended his comments with bit of a somber warning though. “There will probably be a little bit of a consolidation over time, because you know, it’s never been through a recession,” he predicted. “So the jury is still out, what happens to occupancy when that happens?”
Continue the New Jersey conversation. Check out our Upcoming Events. For more from this panel, check out an earlier CapRE Insider Report: Newark’s Latest Trend: Co-Working and Collaboration