Niche-Centric Spaces: A growing trend in commercial real estate

Work is changing, and so is the workspace, therefore, if you want to invest in commercial real estate, you have to flow with the change.

By the end of 2019, it was estimated that there were 22,000 co-working spaces globally, with millions of professionals opting to work from this new type of office, a trend that had traditional office space owners worried.

In 2020, the future of offices and co-working spaces seemed gloomy as people went into hibernation due to Covid-19. During this period, significant changes took place in different sectors of commercial real estate.

With the increased popularity of e-commerce, for instance, traffic reduced in malls and retail spaces while companies occupying buildings and housing offices began reducing their footprint and negotiating short-term leases.

Meta, the parent company that owns Facebook and other social media sites, for instance, took a step to reduce its office footprint in 2022 by opting to sublease one of the buildings it occupied.

The move was quite costly, as backing out of lease agreements attracts fines and other costs, but the company argued that the move would be beneficial in the long term. But this was not an isolated case as many multinationals began moving into co-working spaces, which were primarily designed to accommodate start-ups, small businesses and sole proprietors. By the end of 2022, many assumed that the dust had settled and there were no more changes expected.

Niche Working Spaces

But commercial real estate is still evolving and many things are shifting backstage. Just recently, one of the largest retail spaces, China Square, opened its doors to the public at a mall along Thika Road, a move that has been described as detrimental to three major retail markets. But these changes are not isolated to retail.

The office sector is still transitioning. One of the most interesting changes is the rise of niche-centric spaces tailored to serve professionals within a particular demographic.

Niche spaces could be tailored according to a specific gender, profession, need or shared interest. For instance, climate change enthusiasts may come together to work in a space that is environmentally friendly. Some of the most popular niches include safe spaces for women, wellness spaces for mental health enthusiasts, tech co-working offices and content creation studios.

These kinds of spaces are gaining popularity in Kenya and several players have already invested in niche-centric workspaces. Patricia Okelo, an entrepreneur, author and co-founder, Kayana Create, is one of the players championing the need for women-focused workspaces.

As early as 2016, Patricia was hosting Candid Conversations for Women in Business, a series of events that brought women entrepreneurs together to discuss issues affecting them.

She had a big community of women entrepreneurs attending her events. She even wrote a book, A Candid Handbook for Women Doing Business. Having steered two businesses for over two decades herself, the idea was to help women understand that they can run businesses successfully and even pass them on to their children and grandchildren.

But she needed a sustainable model for the events and the community she was building. Initially, she and her business partner were to set up a space where the current Kayana Hub sits to cater to the Candid Conversations community. But right before the space was designed for the events and the community, another idea came to mind.

“I remember exactly when the idea for Kayana Hub came to mind. I remember thinking, ‘Patricia, all your conversations have been around entrepreneurship. But it’s not just about having a nice event. It’s about supporting entrepreneurs to grow their businesses’.

But at the time I didn’t have a space to provide the kind of support entrepreneurs needed. I first thought of creating a co-working space for female entrepreneurs, but I slept on the idea and later talked to my business partner about it. That’s how Kayana Hub came to be. It’s a space created to accommodate female entrepreneurs.

They can work from here regardless of their profession or business model. We also build a community of female entrepreneurs, we offer capacity building and we form deeper meaning for collaborations with like-minded people within industries.

We also have a programme called Just in Time, where we provide refresher courses that help women run and grow their businesses. These are the types of courses they apply in their businesses immediately.”

Patricia says the traditional workplace is not designed to retain women as they grow in their careers. Though many corporations try to achieve gender balance through recruitment, many female professionals end up leaving the workforce when motherhood begins or due to a lack of career growth.

These women still want to work and most of them end up in business. But business is an even tougher terrain to navigate. Multiple studies have shown that about 50 per cent of businesses collapse within five years of operation due to the hostile nature of the business environment. Navigating a tough business environment in an ageist society requires utmost resilience.

As we come to terms with these truths, women-focused spaces are becoming popular around the world.
Patricia points out that the pandemic accelerated the need for these kinds of spaces.

“When people started working from home, the need for community grew. In 2019, we launched Kayana Hub when the interest in female-centric spaces was just peaking. But when the country shut down, it was an uncertain time. On the flip side, many women who had business ideas began to look for ways to get started since they had a bit of time and space. In addition, many organisations were looking for ways to support marginalised demographics.

We started approaching corporates to help support entrepreneurs who were working from home. We designed gift hampers with products made in Kenya and sent them to content creators who were hosting virtual events.

They were care perks with products made mostly by women in Kenya. As a result, there was a lot of user-generated content and the corporates began to see value in content as female entrepreneurs found out more about our space.”

Coincidentally, Kayana also had space where entrepreneurs can create content for their businesses. In the beginning, the founders had acknowledged that many entrepreneurs are content creators and they deliberately built a space to cater to this part of their businesses. There was a designated space for shooting podcasts with equipment and a technical person, as well as plenty of natural lighting for photography and videography.

Content Creation Hubs and Studios

The pandemic boosted content creation as an actual profession as businesses began to move online and work with content creators to promote their products. As a result, we are also seeing niche spaces that target this new kind of professionals.

Kofisi, one of the biggest providers of co-working spaces globally tapped into this niche recently by setting up a content creation studio that serves podcasters, vloggers and people shooting other types of content.

Baraza Media Lab, one of the earliest entrants in the niche-centric market brings together media practitioners, creatives and entrepreneurs in one space where they can share ideas, learn and scale their professions and careers. It is the kind of space creatives using different media such as print, social media, audio and audiovisual can collaborate to enhance their storytelling capabilities.

The result of such collaborations is increased capacity for individuals who would otherwise be working from their personal spaces with no idea of how to scale their professions. In 2020, Baraza Media Lab launched a podcasting studio that also acts as an incubation program for podcasters, which makes it possible for audio creators to turn their skills into formal businesses. 

Then there is also the rise of Tik Tok and Tik Tokers as a new set of social media professionals. To tap into this emerging profession, the Selfie Village, a Kenyan studio where content creators can take photos and create DIY videos for their channels, was created.

The studio has over 20 creative backgrounds that capture the ambience of a surreal virtual space. Creators can book the space at an hourly rate and create content with some of the equipment at the studio. These kinds of spaces bring out a peculiar pattern; niche-centric spaces are a growing sector and content creation is becoming an even bigger niche.

The gaps and challenges

“Initially, people would just take cute photos and talk about themselves online, but now there is a growing demand for informative content. Audiences are focused on value addition when it comes to content. Entrepreneurs who want to establish themselves as experts in a particular niche can create masterclasses and a series of educative podcasts or videos. They can also host multiple guests on their podcasts and channels, which is a bit difficult if shooting from home. With these kinds of studios, it’s possible to shoot multi-media content as they shoot their podcasts, so as to increase visibility online. When we started designing the space, we had to make it beautiful enough, incorporate African décor and ensure there was plenty of natural lighting. We also invested in equipment for podcasting and other types of content production,” says Patricia

She, however, notes that the biggest challenge for those providing these kinds of spaces is the cost of rent in Nairobi’s commercial spaces. Many players in the market are trying to make the spaces affordable by charging an hourly rate, which means a lot of record-keeping and tracking to make sure the business is not making losses. They need to use co-working software, which also comes at a cost. It can be difficult to balance all this but there is plenty of room for growth and many unexplored opportunities.

Looking ahead, Patricia hopes to expand the women-focused niche and help inspire the much-needed systemic changes that will keep more women in the workforce. 

“As a space for women entrepreneurs, we are realising a lot of the changes we need are supposed to be institutional. In the long term, we are trying to figure out how we can inspire these institutional changes. In the short term, we hope to influence other players in the co-working sector to accommodate women in their spaces. We would love to see others incorporate the model we have here at Kayana,” she says.

In the meantime, she is happy to trim down some of the obstacles that women face in businesses. She points out that female entrepreneurs don’t have to face the challenges she faced. Women can leverage their soft powers to become successful entrepreneurs.

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