The Satellite Centers is a California-based flexible workspace operator. The company opened its first space back in 2009, before coworking and flexible space were mainstream. Twelve years on, and the company remains as committed to the industry as ever…even while weathering the storm of a global pandemic.
“We are, in fact, about to open a new center in Campbell, California,” Barbara Sprenger, Founder of The Satellite Centers and Satellite Deskworks, recently shared during a phone interview.
The new location will be the company’s 7th coworking space. And despite the fact that it was ready to open in March, right when the pandemic hit and lockdowns went into effect, Sprenger says that they remain optimistic about the future, stating that they continue to see demand for flexible space.
“We actually started the process of building out the Campbell center almost a year ago, when we first signed our original lease. Since we couldn’t open as planned, we have focused on getting everything ready and ensuring the space is comfortable, beautiful and fully functional for when people can start coming in.”
The Satellite prides itself on running small, highly automated, and profitable flexible workspaces.
“If you are going to do smaller centers, then you have to find ways to maximize use of the space and increase efficiency, as you will be making profitability on the margins. This means that your marketing has to be better, that operations need to be highly automated and efficient, and that you have a broad range of offerings to appeal to a wide audience. Every square foot of the space has to be working. ” The Satellite developed Satellite Deskworks, intuitive and flexible software for running centers, to minimize the time and effort needed for operations while increasing tracking and accuracy.
Because The Satellite Centers offer mail services and office space for essential businesses, they have been able to remain partially open during the lockdown in California.
As for the new Campbell center, Sprenger mentions that they are ready to open it and welcome their first members. “We’ve taken advantage of the past few months to create a more COVID-friendly distanced layout, increase filtration in HVAC systems, add HEPA filters, and set up safe traffic flows within this space and the rest of our locations.”
Weathering the COVID-19 Storm, Tips from Sprenger
As a veteran of the flexible workspace industry, Sprenger had some wisdom to share with others, especially about what operators can do about their lease exposures to ensure they are in a better position to keep their doors open as the world continues to navigate the coronavirus pandemic.
- Operators need to prioritize how they will deal with their leases and landlords, since leases probably account for 40% – 60% of your normal revenue.
- Talk to your landlord and be honest with them; bear in mind that they are also going through the same thing, so be sensitive to their needs as well.
- Be honest and realistic about what you can pay, but be sure this is a discussion, not an ultimatum.
- Many operators first approached their landlords at the beginning of the pandemic. Sprenger recommends it’s time to go back and talk to them again. “Back in March, we thought this was something that would last for 2 to 3 months; we are now realizing that the current situation might go well beyond the beginning of next year, so the conversations with your landlord need to reflect that.”
- Take advantage of available government assistance programs, both PPP through your SBA-approved bank and EIDL through the SBA directly.
- “As long as you have some income coming in, you are in a position of strength. Landlords, just as any business, would rather have some rent than none. If you go under, their ability to sign a new tenant is minimal at the moment.”
- Try to negotiate an agreement for partial rent, with the balance not needing to be paid back, or only partially paid back. If your income is reduced for another 6 – 9 months, you will have difficulty repaying lost rents. Your landlord has probably received some federal assistance, and that needs to be taken into account.
- Most important of all, don’t avoid the issue. You need to sit down and come up with a strategy.
The Satellite Centers has been donating space to All Good Work resident organizations since 2018. They currently host InSTEDD and Creative Crisis Leadership in the Sunnyvale location and the Enneagram Prison Project in Los Gatos. They have also donated Satellite Deskworks Workspace Management Software to All Good Work for managing all of the non-profits and coworking centers who provide space for them.
