As the millennials approach their 40s, GUEST magazine digests the disruptive ways this globalised generation is changing the business of hospitality – blurring the borders between workspace, home and hotel.

By Kim Wyon & Christian Brorsen

The millennial demography is no longer niche. Now aged between 25 and 43, the older of this first generation of digital nomads have reached their early 40s, carving out senior corporate careers and raising families. Currently, they are being joined on the travel circuit by their younger siblings born after 1996, called Generation Z (Gen Z). Combined, this younger demographic now makes up 50 percent of the world’s workforce.

Catering to the needs and cravings of younger generations, hospitality providers worldwide are developing game-changing business models that blur the borders between home, hotel and workplace. Underpinning several innovative industry developments is the re-evaluation of shared space.

This is seen with category-shattering hotel accommodations that recalibrate the ratio between private space and public space, offering shoebox-sized guestrooms yet spacious lobbies for co-working and socialising – also for daytime-only paying guests.

Another emerging trend is workspace hospitality – dubbed ‘workspitality’ – where hotel amenities are co-shared with neighbouring offices and where traditional hotel services are extended to workplaces in the local community. GUEST magazine takes a whirlwind tour of millennial-friendly concepts reshaping the industry as we know it.

HOTELS AS SOCIAL SPACES 

From The Hoxton and Ace Hotel to Moxy (by Marriott) and citizenM, millennial-friendly hotels – sometimes called ‘micro-hotels’ – break the rules of traditional categorisation, offering downsized guestrooms and maximised co-shared space.

Complete with Insta-worthy designer lobbies, full-service micro-hotels were originally conceived to entice travellers away from homey Airbnb offerings and to curb the rise of luxury hostels (dubbed ‘poshtels’).

An early example of the poshtel concept, Generator Hostels (locations include Stockholm and Copenhagen) first launched in 2007 to target the then emerging breed of backpackers (coined ‘flashpackers’) who sought cushier amenities and more shared chill-out space than previous, cash-strapped backpackers. Single and double rooms were later added to their mix of accommodations, erasing the line between hostel and hotel.

Now, the Scandinavian market is bracing for an entirely new generation of cleverly-designed urban hostels to renew their cred with younger travellers. Few would have believed a decade ago that Asian-styled capsule hotels would find a European (let alone a Scandinavian) iteration combined with generous co-shared space – but now it’s happening.

This year, the CityHub chain is set to open their first hotel outside the Netherlands, in Copenhagen’s hot and happening Vesterbro district. CityHub hotels offer sleeping pods they call ‘hubs’ containing a sizable double bed and equipped with music streaming and WiFi. Bathrooms and toilets are shared as at regular hostels. But is Scandinavia ready for the ‘hub’?

“As part of our expansion throughout Europe, CityHub sees Scandinavia as an interesting market. Indeed, we are currently looking for a suitable location in Stockholm,” says CityHub co-founder Pieter van Tilburg to GUEST magazine.

The CityHub Copenhagen hotel with 215 ‘hubs’ will be the chain’s largest to date, and as an added Scandinavian feature, the hotel – apart from urban courtyard and roof terrace – will also offer access to

Wojo Paris Champs Elysées, one of a growing number of Wojo co-working spaces in the French capital.

NEW AGE OF CO-WORKING 

Does anyone remember the internet café? These early machine rooms of the then newfangled Internet helped leapfrog a whole generation into a new way of working. Similarly, co-working spaces later emerged to offer freelancers as well as fund-strapped startups communal workspace for co-creation and networking. An early example in Scandinavia was Mesh in Oslo, which in 2012 became Norway’s first co-working space.

Today, Mesh is a member of the Creators Community of innovation hubs across the Nordic region. Worldwide, such co-working offerings have not only been developed as incubators and accelerators, but also as carefully curated ‘collaborative workspaces’ for curious and creative individuals.

NeueHouse in New York and Los Angeles (founded in 2011) is one such example offering a range of services and co-shared amenities, including broadcast studios, screening rooms and membership hotel perks – and naturally, culture-savvy communal dining.

Co-working offices, however, are no longer a fringe offering for ecosystems of startups – major corporations are increasingly signing up. With the woes of global flagbearer WeWork (trail-blazed in 2008) fresh in mind, you may be forgiven for believing that the business case for co-working leases was shaky.

But there are definite advantages. Basically, co-working as a business concept bridges a property owner’s requirements for long-term security and the tenant’s desire for flexibility, scalability and financial efficiency.

There are, indeed, compelling competitive advantages. HUBNORDIC is a collection of three co-working office properties in Copenhagen’s Ørestad district owned by KLP Ejendomme A/S, a Danish property investment subsidiary of Norwegian pension fund KLP. As an institutional investor, long-term viability and risk management are natural concerns.

“Unlike many other European cities, Copenhagen has many different evolving business centres that often enjoy the fleeting interest of novelty. The office lease market is competitive and as a pension fund we believe that if we fail to invest in customer service we will risk creating products for which there will be no future demand. The current job market means that corporations, whether tech companies or auditors, are competing for the very same professionals.

“That’s why with the HUBNORDIC project we seek to give businesses the opportunity to enhance their global recruitment by offering a dynamic and colourful co-shared workspace rich in experiences,” says CEO of KLP Ejendomme A/S, Søren Risager-Hansen, to GUEST magazine.

“We no longer simply supply office space, we offer services. Front desks, meeting facilities, garage parking and lobby cafés – these are all mainstays of co-working office developments. What we seek to do is give these amenities an added competitive edge – and stay one step ahead. We are learning all the time,” Risager-Hansen adds.

Across Scandinavia, the drive towards offering serviced co-working space as a long-term investment strategy is gathering momentum. Swedish property investor Castellum last year acquired United Spaces, a company that has more than a decade of experience in developing full-service co-working office space.

A forward-thinking investor, Castellum is the sole Nordic property and construction company listed in the Dow Jones Sustainability Index (DJSI), owning properties not only in 20 Swedish cities but also in Helsinki and Copenhagen.

“Co-working is about so much more than attractive workspaces. It’s resource-efficient for the planet as well as for our wallets, but it’s also about building fellowship and a unifying flow among people, spontaneous meetings and creativity. In central London and Manhattan, co-working now accounts for 25-30 percent of the newly signed lease agreements on the office-space market.

“We would like to open several co-working spaces in the near future in Scandinavia, and we see this as a strong and clear option, both for micro-companies and for major enterprises. We see the importance of adding services to our existing portfolio of primarily office and logistic properties in order to be successful and competitive in the long term,” Henrik Saxborn, CEO of Castellum says to GUEST magazine.

Representing a different approach to the provision of co-working space, OfficeHub (founded in 2016) has developed a web-based marketplace where property owners on the Danish market can list their available office space. Over the past couple of years, the company has adopted a managed marketplace approach that includes lease brokering and a wider range of services from housekeeping to catering.

“We originally thought we would become the Airbnb for co-working spaces, but it turned out that finding the right kind of office is a much bigger decision than deciding where to spend a two-week holiday. There are many parameters to consider, including accessibility, location and potential to grow without having to move again.

“We have therefore adopted a managed marketplace approach where we help create greater market transparency and offer our services in brokering the right deal. We also provide services related to the maintenance and operation of an office or workplace, creating a one-stop shop for the co-working segment in the real estate market. Our advantage is our wide network of property providers featured on OfficeHub as well as our experience in the field,” co-founder and CTO of OfficeHub, Marc Falk, says to GUEST magazine.

Surprisingly, Airbnb is a latecomer to the co-working market. Although one of the company’s major selling points is offering the convenience of ample rented living space, the company only last year introduced a toggle specifically facilitating searches for work-friendly accommodation.

HUBNORDIC office spaces are developed as integral parts of urban environments in Copenhagen’s Ørestad district.

WORKSPITALITY – WORKPLACE HOSPITALITY

Scandinavian hotels are no newcomers to offering co-working space. Across the industry, hotels have long sought to commodify underused lobbies and business centres by relaunching them as co-working facilities – not always successfully. But aiming to reach the millennial segment of travellers, providing co-working space is widely considered key to success.

Copenhagen is currently experiencing what arguably could be called a new wave of Netherlands-based hotel brands where co-working is embedded in their DNA. citizenM is another millennial-targeted lifestyle brand based in the Netherlands, currently with 30 hotels scattered across the globe from Taipei to Seattle – and since 2018 also in Copenhagen.

“Thanks to our vibrant and large living rooms, we ooze a ‘welcome to all’ personality, which makes our hotels buzzing, guests and meeting room users enthusiastic, and outside people come in for a coffee or a drink. As we like to say, in our living rooms they can ‘work, rest and play’. While we love that our living rooms are so popular, it isn’t clear at the moment what we allow in our space. It’s logical to think that a hotel is for hotel guests, and that our meeting rooms are for people who want to do business. But what about co-workers?

“Our answer has been to introduce day passes, which also appeal to global nomads seeking an inspiring place to work for a day. citizenM is not a co-working office concept, but a great place to drop by with your laptop,” citizenM says in a statement to GUEST magazine, while also confirming their wider interest in the Scandinavian market. They are currently seeking new locations in Stockholm and Copenhagen.

Another Netherlands-based example is the ZOKU hotel brand (originally launched in 2016 in Amsterdam) that offers studio accommodation with homey, built-in workspace. Described by ‘Tech Insider’ magazine as “WeWork combined with Airbnb”, the first ZOKU hotel outside the Netherlands is slated to open later this year in Copenhagen’s Ørestad Nord district, a development set to be followed by a rollout of 50 ZOKU hotels in major European cities from Vienna to Paris as well as in several US cities.

Apart from the 30m2 Loft Studios for short-term stays, ZOKU also offers so-called Bootstrap Rooms complete with bunkbeds and access to the hotel’s ample co-working and socialising environment. Purpose-built using salvaged and recycled building materials, the 160-room ZOKU hotel in Copenhagen will also include eco-conscious amenities such as an organic supermarket.

Faced with such service innovation from emerging independent brands, major franchising companies aren’t resting on their proverbial laurels. AccorHotels is developing new co-working concepts to support their existing portfolio of 20 hotel brands. Initially targeting France, the AccorHotels co-working concept dubbed “augmented hospitality” is to be marketed under the Wojo brand name. Eight Wojo venues have already opened in Paris, and two in Lyon.

On a wider European scale, AccorHotels is to offer three different Wojo models. The first, called Wojo Spots, will cover co-working facilities accessible to hotel guests free of charge, whereas non-staying visitors must subscribe. AccorHotels aims to establish 1,000 such Wojo Spots at affiliated hotels throughout Europe by 2022. Their second concept, Wojo Corners, will eventually bring AccorHotels into entirely uncharted waters.

Although initially opening at affiliated hotels, Wojo Corners will later also open at train stations, airports and shopping centres. The first Wojo Corner was launched in 2018 at Hotel Mercure Paris Montmartre Sacré-Coeur, and the aim is to open 100 across Europe by 2022. With their third concept, Wojo Sites, AccorHotels takes the final plunge into developing a stand-alone co-working brand. Wojo Sites are to offer full-service corporate offices of over 1,000m2 but no accommodation.

The provision of Wojo co-work ing concepts – with or without hotel rooms – has been described by Wojo CEO Stéphane Bensimon as ‘Workspitality’. This expanded understanding of workspace hospitality is also emerging in corporate office development – projects where hotels provide a wide range of hospitality services to neighbouring office tenants. Skanska A/S is currently developing two new major office projects in Copenhagen that both include hotels.

Next year, Scandic CPH Strandpark is set to open in Scanport, a new waterfront business district within close reach of the city’s airport. The conference hotel will offer 357 rooms as well as a wide range of facilities from meeting rooms and underground parking to a restaurant and indoor pool – functions that will be accessible for the neighbouring office complex, Scanport Glasværk and coming office projects.

Likewise, Skanska is expanding its Nest45 office development with an annexed hotel slated to open in 2021. Located next to the city’s largest conference venue, Bella Center Copenhagen, the 186-room hotel is to be operated under the AccorHotels brand Ibis Style, a franchise that combines business with leisure – in this case in more ways than one.

“It is our experience that potential office tenants are to a greater extent than previously looking at the total package. What we as property developers can offer besides office space with a fixed square-metre rent is the flexibility of co-working space to expand according to need as well as a range of added services that include meeting facilities, catering, fitness centres and bicycle parking and repair. Other services in demand include reception, private housekeeping, food delivery and laundry service.

“Many such services are a natural part of a hotel concept that make everyday life easier for the individual corporate employees, which is why we believe it makes good sense to combine offices with a business hotel. From the developer’s perspective, then besides the availability of hospitality provision from a hotel, there are also several other facilities that can be co-utilised, such as fitness, restaurants and parking,” says Peter Nymann, CEO of Skanska A/S Denmark, to GUEST magazine.

Throughout the industry, ‘Workspitality’ promises new avenues of revenue, while supporting a better work/life balance, not least for young corporate professionals – an important factor when recruiting and seeking to retain the travel-ready Gen Z demographic

Swedish property investor Castellum last year acquired United Spaces, a company that has more than a decade of experience in developing full-service co-working office space.

GLOBALISED GENERATIONS

The generations reshaping hospitality.

MILLENNIALS

Born between the late 1970s and 1990s, the millennials are the first generation to become digital nomads and experience the open skies of cheap air travel. They shaped social media and co-sharing platforms such as Airbnb.

They are also the first ‘post-stuff’ generation who generally value experiences higher than possessions. And with the wide world as their workplace, millennials were the first to embrace co-working spaces and are currently reinventing co-living for a new age of serviced shared apartments. As travellers, they are adventurous and seek authentic local experiences guided by their social media network.

GENERATION Z

Born after 1996, Generation Z is the first demographic never to have experienced a time without the Internet. With the Great Recession of 2008 as part of their childhood, they are more pragmatic than their older siblings. They avoid taking loans and are more career-focused. Like millennials, they are into renting rather than owning and embrace car-sharing and co-living.

Generation Z consumers are less inclined to waiting and saving – they want experiences now! So why own when you can share and rent? Smartphone-immersed and influenced by social media, they are very conscious of their online presence. As travellers, they seek authentic local experiences that reflect their personal narrative and love of co-creation.