Last week it was announced that 5 companies were awarded a $50M contract to help connect employees of the federal government of the United States with flexible or coworking workspaces.
I should ofcourse note that this is not the first time a national government has leaned heavily into flexible workspaces. The Irish government for example, has invested into and commissioned their own booking infrastructure for flex space and made it possible for their government workers to work remotely from these remote and often suburban hubs. (See TWIC #51/20, #01/21, #03/21 & more).
But the General Services Administration (GSA) is a huge occupier of office space, apparently the largest occupier in the world. So this has been making waves across the news, social media, the industry and further afield.
I’ll be digging into what this all means, in a discussion with coworking operators of all sizes at the next This Week In Coworking discussion over on Clubhouse on Friday the 27th at 10:30am Eastern.
But I wanted to highlight a few points for folks who aren’t following this and other industry trends as erm… geeking… as I may be.
Firstly, what I know.
The GSA put out a request for proposals for a shared contract worth $50M to help federal employees access flex workspaces. (Officially: create a streamlined procurement process for federal agencies to procure flexible workspace)
There was an 18 month evaluation process, and the GSA procures for agencies totalling 2.1 million employees.
Some of the budget needed to be set-aside to go to small businesses. (Small businesses in the purview of the US government is less than $30M in annual revenue.)
The contract was awarded to five businesses, 3 workspace operators and 2 booking/aggregator platforms.
What I didn't know (and asked around for answers to).
These are some questions that came to mind whilst preparing for this weeks discussion.
I did my best to get answers and look forward to elaborating on them during the TWIC discussion on this topic.
“The contract is on IDIQ (indefinite duration indefinite quantity) terms with a total spend of no less than $50M”, said Mark Gilbreath from LiquidSpace during a recent discussion I had about these questions.
We also dove into the actual process for each request (or ‘order’) for flex workspace from the GSA.
It’s a little lengthy for this answer, but in short, the applications/responses from the aggregators will be on behalf of 3rd party spaces in their network, and so some of that revenue will make it’s way to independent operators.
Due to the set-aside mentioned above, every other request (aka task order) for flex space will only be available to small businesses.
So 50% of the requests will have to go to smaller workspace operators, but the firms who qualify for this set-aside are also able to apply for the other half of the task orders as well.
This contract allows the 5 selected companies exclusive rights to submit offers to requests for flex workspaces by any/all agencies for whom the GSA handles procurement.
This sits alongside existing service providers who procure, source, build or operate more traditional office and workspace for the GSA.
There are certainly instructions but they’re not as simple as completing a checklist. The requirements cover things like IT security, and disclosures and warranties around a few other things like health & safety, privacy, and sustainability.
If you’re interested in hosting government employees and agencies, I’d suggest reaching out to the teams at either Deskpass or LiquidSpace for more information on what these restrictions are.
But here why it's great news for the whole industry.
The GSA is a HUGE occupier of office space in the world. In April 2020, they were leasing 47.6 million sqft (via 541 separate leases) throughout the DC region alone.
With the GSA joining large firms like Standard Chartered (see TWIC#7/21) and Schneider Electric (see TWIC#8/21) in leveraging flex workspace options, it reduces the number of objections from other organizations, of any size, around embracing third spaces .
“Our government is the single biggest employer in the US, with over 2.1M employees and amongst the very largest landlords in the world. So seeing them lead with actions to adopt the future of the hybrid office and materially evolving the way they work and utilize their portfolio is inspiring and encouraging for the future of our industry and all of the beautiful spaces that we work with daily.” – Sam Rosen from Deskpass
How it affects the 5 companies awarded the contract.
For the 3 workspace operators, the benefits are pretty straight forward, they get to place government employees and agencies into their spaces.
Bill Bennet from Expansive shared how they “appreciate the opportunity to show the GSA why Expansive leads the flexible workspace industry in stability, center size, range of space offered, price, and customer service.”
For the 2 booking platforms, they get to help individuals, teams and agencies explore more spaces and options from those signed up to their platforms.
How it affects the other platforms & flex space brokers.
Whilst placing official government workers may be exclusive to the contract awardees, it does open new opportunities to other platforms.
Maybe explore how to support near-Government workers. Or double-down on other sectors, markets, or national governments, using this announcement as social proof.
The entire world is changing how they work, there’s millions of working people and organizations that still need seamless, efficient and affordable access to workspace nearby, whilst on the move and wherever their lives will take them.
What it means for other flex workspace operators.
If you’re interested in hosting government entities, personnel, or agencies – be sure to contact the two aggregator platforms about listing terms and details.
But even if you’re not, this news highlights the shift of even the largest employers in the world to embracing and leveraging coworking as part of their workspace strategies.
What this means is that you need to really explore how you’re adding (and maintaining) as many opportunities or channels within your workspaces’ Operational Stack to make sure you, and your space, aren’t leaving money on the table as these changes happen.
I for one am watching eagerly to see what waves are created across the coworking world following this ‘little’ pebble of news.