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Despite anything you’ve heard about the rest of the country, in New York City the real estate bubble has decidedly not burst. For a growing business, finding the right space to create your product, or offer your service, can be a daunting and expensive prospect. That’s why many companies are eschewing the traditional rental agreements for something more fluid, adaptable, and affordable—shared spaces.
In terms of finances, shared spaces can be a relief for entrepreneurs, says Kathrine Gregory, founder of The Entrepreneur Space, a not-for-profit food and business incubator located in Long Island City that offers both shared kitchen and office space, in partnership with the Queens Economic Development Corporation. “If they were to go out and try to get space, even a small space, you’re talking about a $100,000 investment between the equipment, the build-outs, the rent, the security deposit, the real estate fee, building licenses—that’s $100,000 somebody doesn’t need to spend,” she says.
Laura Ciccarello of Nexus Labs, a fashion and tech co-working space in midtown Manhattan and an extension of Nexus Showroom, a privately owned showroom and media agency, agrees: “It’ll greatly reduce their overhead in having a set office destination. A lot of showrooms and buildings in this area have a tendency to rent for $20,000 per floor, so it’s a tremendous opportunity for a company to capitalize on the centrally located area.”
The Entrepreneur Space has been running since 2005 and Nexus Labs plans on being fully up and running in mid-April 2012. Both Nexus Labs and The Entrepreneur Space work on a schedule, where a business can work out in advance when they want to use the space, and how often. Depending on the frequency—daily, weekly, monthly—the business can pay a set fee, or negotiate depending on the size of the space and what’s required.
Both spaces offer another benefit for growing businesses besides saving money: collaboration.
“One of our office tenants does edible cake toppers,” says Gregory. “She formed a partnership with a baker in the kitchen, and they have done several projects together. Several of our caterers purchased products from some of the bakers. They’re both in the kitchen, but it’s two different businesses working together.”
“The big benefit is that we’re creating a community of people who have similar projects and have potentially similar outlooks on the business, and there would be millions of ways they can collaborate,” says Ciccarello. “Everyone in this business has something different that they want to bring to the table.”
One of the main concerns that both Gregory and Ciccarello have found with potential participants is a fear of competition, or another similar business in the shared space copying their product. To combat this, both spaces try not to schedule similar companies at similar times, unless otherwise requested. However, says Gregory, the worry about intellectual theft is something that often fades with experience. “What happens is the more that they get into the mindset of being an entrepreneur, and they’re out there selling and they see how many people are out there with products somewhat similar to theirs, I find that they relax, and the rigidity goes away.”
Michelle Court is the associate editor at The New York Enterprise Report. She can be reached at firstname.lastname@example.org.