Major office space provider IWG has started adopting the franchisor model, pioneered by fast-food company McDonald’s, in its effort to edge further away from WeWork.
Flexible space growing rapidly in Tokyo
Tokyo’s flexible workspace market shot up last year thanks to coworking giant WeWork entering the market.
Flexible workspaces grew to 156,000 square meters in Tokyo’s 5 wards last year, up 48% from 2017. WeWork itself operates over 40,000 square meters in the city.
“WeWork has significantly impacted the status quo of the flexible workspace industry in Tokyo’s CBD,” said Tomoyo Nakamaru of JLL Research in Tokyo. “Demand for community-oriented shared workspaces is picking up sharply as large corporates are focused on work environments that generate innovative ideas and boost growth.”
In 2019, flexible workspace in Tokyo’s CBD is expected to grow 20% and continue on into 2020.
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The shift towards flexible working is also able to bring the discussion of Japanese workplace culture to the forefront, which has been focused on long office hours. Now, a new law will address issues such as overtime, paid leave and other work-related problems.
With demand so high, serviced offices have also started adding lounges and common areas to their spaces.
Developers such as Mitsui Fudosan and Tokyu Land Corporation have launched their own coworking and serviced office brands as well.
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America’s malls are becoming more and more vacant, but coworking companies are taking advantage of these empty spaces to expand their services in a nonconventional way.
Flexible workspace provider Knotel has once again expanded its presence in central London, signing three new deals across the city totaling 40,000 square feet.
Office Evolution, the nation’s biggest coworking franchisor, will expand its footprint in Mount Pleasant as it continues to cater to small business owners in the area.
Although coworking spaces are often categorized as servicing major cities, tier II cities are having their moment as many startups continue to flood into these areas.
Amy Nelson, CEO of The Riveter, has made it her business to promote inclusivity of women in professional settings while also providing men tools to value gender equality.
A survey of 1,000 WeWork members found that, while some use the space out of convenience, others find the culture to have an effect on their professional identities.
While WeWork is expected to file for an IPO this year, its valuation and recently announced losses have left investors worried about the sustainability of the company.
IWG has started rolling out a franchise model, similar to that of McDonald’s, enlisting franchisees to take the reins in subleasing Regus and Spaces offices to companies.
Chicago-based Novel Coworking has purchased Denver’s 195,753 square foot, 17-story boutique office property Trinity Place in Uptown that is currently 65% leased.