Business & Space Overview
Perfect location, between the University and the tech corridor, 12 offices, 2 conference rooms, large open/even space, and an always occupied high demand industrial space, this space has been split between remote workers, entrepreneurs, and university affiliated researchers and students.
The opportunities for growth within the space and to the neighboring suite is perfect for a coworking chain looking to expand to a desirable California city that can focus on operations and marketing. The current business owner has been distracted by other needs and hasn’t been able to focus on the coworking space. He has done the hard work of getting it close to break-even with a strong and growing hot desking community and offices. The space will generate thousands of dollars as-is come September when the offices will fill back up. The current warehouse renter is paying around $2,000 below market rate and is month-to-month.
The new owner should plan on investing another $30,000 to $50,000 to build out additional offices that are in demand and at a premium in Santa Barbra. This will concentrate the hot desking community to create a vibrant culture while adding revenue with 8 to 10 additional offices. The space has been priced so the new owner can likely earn their money back in 18 months even with the investment in new offices.
High Concurrency Possible
This space serves two demographics with different timing needs: remote working parents seeking shared workspace during the day and university students who would rather pay our membership fees than university parking costs at night. Additionally, the coworking space is closer than the library for university affiliated faculty and graduate students living in university housing.
Although currently staffed 8-5, that is primarily to be responsive to walk-in sales opportunities. The space caters mostly to members, and people who pre-book online. A single minimum wage staff member currently staffs the front desk.
Marketing Is The Growth Opportunity
Less than $200/month has been spent on marketing. Profitability could probably be quickly turned around with skilled marketing efforts.
Opening Into COVID
The business opened February 27, 2020, meaning the first 18 months were mostly closed. Although technically open a little over two years, it's business momentum is just getting started.
The biggest failings by the current management are marketing (organized campaigns and adequate spending) and sales (insufficient follow up and closing). Generally, once a membership is sold, the most common reason for relinquishing membership is moving from the area.
About the Seller
The seller is a highly enthusiastic women in business and technology who opened the space to be the local area's science and technology "club house." Unfortunately, her health began to decline several months ago and she is no longer able to manage the space.
DenSwap’s email newsletter is the best place to learn about upcoming spaces for sale expansion opportunities through management contracts, and news from the coworking + CRE world.