The basis of the shared work space is the ‘Coworking space agreement’, which is an agreement that establishes the willingness of co-workers to work in a common workspace in their professional capacity, and legalises the terms of the work arrangements. Generally, a membership agreement is drafted after the submission of a business plan, following the signing of the coworking service agreement.
Advantages of Shared Space Agreements from the User’s Perspective
Shared space agreements are appealing to the user for many reasons, most of which come down to ease and simplicity.
Quick and Easy
License agreements are usually short, simple contracts written in plain language rather than complex legal language. Licensees appreciate that licenses are easier to understand than leases, and negotiations are usually quicker because there is less to hash out.
Less Expensive than Leasing
Licensing space is usually much less expensive than leasing space. Licensees can contract for exactly how many work stations they need rather than taking on an entire demised space, and it is usually at a much cheaper transaction cost. They often pay one flat fee that covers all other ancillary charges typically passed through to a tenant under a lease (e.g., utilities and common area maintenance). Additionally, there is less upfront cost in a license than in a lease because licensors usually require less (or no) security deposit, guaranty, and insurance coverage.
License agreements are typically much shorter in term than leases and offer early termination options to both the licensor and licensee. Start-ups especially like the flexibility of licenses because often they are not able to predict their space needs over the long term and do not want to be locked into a years-long lease.
Laws and regulations can prove to be quite cumbersome for a business and it diverts the focus from the core functions to mere formalities which can easily be avoided. At CoKarya, we not only have simple agreement terms but also assist coworkers with other legal compliances.