‘Business Lounges’: A Niche Within America’s Co-working Space Industry

A Milwaukee co-working space combines work and play.

The Hudson Business Lounge in Milwaukee’s Historic Third Ward. / all company photos

 

Milwaukee, WI – While the mainstream understanding of co-working spaces remains shaky, the trend itself is very real. In a decade, the number of co-working spaces has gone from very few to almost 14,000 worldwide. The best-known industry player is WeWork, which expects to have 60 total locations by the end of 2018.  The typical WeWork space is mostly focused on just that—work—with minimal lifestyle amenities. Other spaces are popping up that better mix enterprise with recreation. One of them is Hudson, a Milwaukee workspace that calls itself a “business lounge.”

I stumbled upon Hudson while visiting the city one recent weeknight. I was searching for a coffee shop, and Google found me a large store occupying the ground level of a historic warehouse. After entering, I was faced with two separate doors. To my right was a spartan workspace with people on their laptops. To my left was a slick lounge with dim lighting and a fireplace, filled with several couples. They were both part of the same facility, but I took a left, only to soon learn about this alternative co-working space genre.

Hudson Business Lounge is a 2-story, 10,000-square-foot facility along the main retail corridor of the Historic Third Ward, a revitalized warehouse district southeast of downtown Milwaukee. It was founded five years ago as a generic co-working space, to attract a professional class that’s been budding in this traditionally blue-collar city.  Since then, said co-founder Gary Lato, Hudson has become more all-purpose, moving away “from a typical co-working space, into essentially an events space, a shared office space, a conference center, and a casual dining café all rolled up into one.”

Hudson’s main portion, which Lato gave me a tour of the next day, is the work area. It features enclosed conference rooms, cubicles, open office work tables, an upstairs common area, and like with WeWork facilities, phone booths to take calls. After 5 years, this space has several hundred regular members who use it on various time schedules. Hudson also rents it during off hours as conference space for numerous groups — non-profits hosting fundraisers, family Christmas parties, even a church that holds its Sunday service here. Another crucial use is networking. The space mixes solopreneurs and start-ups, many of whom end up collaborating. For example, one of Hudson’s regular members specializes in building LinkedIn profiles for businesses, and has found multiple clients here. Annual memberships range between $834 and nearly $5,000, depending on usage levels.

The “business” area of Hudson Business Lounge…

But Hudson’s most unique aspect is the “lounge” part of this Business Lounge concept. Its lounge faces the street, and is available to both members and outsiders, making it far more open to the public than most co-working spaces. Lato said one purpose of the lounge, with its outstretched bar that sells coffee, alcohol and fast casual food, is to generate revenue from members, by appealing to their needs throughout the course of a morning-into-night work session. But it’s also meant to attract people from off the street, such as myself, who enter to make one-time purchases, but may learn about Hudson’s workspaces in the process. Lato estimates that two-thirds of the lounge’s customers are these walk-ins.

…and the “lounge” area.

Hudson’s work-play model—in which two seemingly opposite uses are separated by a mere wall—is being tried elsewhere. In my hometown of Charlottesville, VA, the Common House recently opened as a “social club” for the city’s young professionals. It is more upscale than Hudson, and even more geared around recreation. Its workspace—hardly the building’s feature aspect—is in a remote section of the ground floor. The second floor has a pool table and common area, while the rooftop is a bar overlooking downtown. Recently Forbes profiled an Atlanta space called The Gathering Spot, which is a self-styled “city club” that hosts freelance workers and businesses during the day, and community events at night.

Co-working spaces, as a rule, have made various statements about our changing economy and culture — the rise of freelance work, the death of the traditional office, and the desire to network within urban-style centers (where most facilities are located). Another trend they convey is the apparent willingness to merge work and recreation in the same communal space. Hudson Business Lounge is Milwaukee’s version of this, and the model may be replicable elsewhere.

[This article was originally published by Forbes.]

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