Office rentals rising amid downturn

NEW YORK (Reuters) - Attorney Dick Dorsett, laid off a year ago, has recently started going to the office.

But it's not his employer's office and the people around him are not his colleagues. Dick is "co-working".

So-called "co-working spaces" were once the domain of software developers and creative freelancers, who for a fee of about $250 a month, can rent a desk and access to meeting rooms, photocopiers and other useful office facilities.

But the recession has made the idea of working amongst strangers appealing to a broader range of people, from those that recently lost their jobs to consultants eager to stay in the loop.

"I do my best work in a bull pen," said Dorsett, 56, from Tacoma, Washington, who is actively looking for a new job.

"It's instantaneous accountability. Everyone knows what you're doing. It's taken me out of my comfort zone and I'm getting a lot more done than I would at home."

Co-working spaces across the United States have reported increased demand.

Alex Hillman in Philadelphia said his IndyHall space is seeing an increase in people who are "moonlighting", working at night to put extra cash in the bank and build out their network. To accommodate them, he has added a night shift.

In Des Moines, Iowa, Abby Shipton pays to use the Impromptu Studio co-working space once a week, since her interior architecture firm cut her hours to four days a week, docking her pay accordingly. She uses the extra day to work on her own projects for extra cash.

In San Francisco, Citizen Space is expanding from a seven-person office to a 24-person office at the beginning of March and said that while their clientele used to be primarily software developers, now they include a number of consultants.

An informal survey of owners of co-working facilities conducted by Emergent Research last year found two-thirds were "very optimistic" about their prospects in the recession. They said in a tough economy, small businesses would prefer their flexible daily or monthly leases over fixed two- to three-year commercial leases, and that networking opportunities are more valuable than ever.

One concern found among co-working space owners is that freelancers could simply work at home rather than paying for office space, according to Emergent Research.

Perhaps to avoid that potential problem, Office Nomads in Seattle is offering a "Pink Slip Special", discount introductory rates to people who show their pink slips at the door.

(Reporting by Kristina Cooke, editing by Leslie Gevirtz)