April 18th
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.
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March 20th, 2019 - By Aayat Ali
REITs allow coworking providers to balance out potential risks and rewards
Coworking has been embraced by many real estate investment trusts (REITs) across the nation. Shared office models have established a permanent shift among how employees work, which has created a pathway for U.S. office REITs.
Still, the rapid growth carries rent risks that need to be managed. Many operators avoid such risks by associating with less established tenants, but this model can hold also brings asset/liability that favors customer commitments. This leaves REITs unable to offset the high capital of certain office assets.
Now, many U.S. equity REITs and other real estate companies have gone public with both the benefits and risk that come with contracting a space out to coworking tenants.
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“Long-term leases are a key positive office sector attribute that help balance high capex and leasing costs,” said Stephen Boyd, the Senior Director in Fitch Ratings’ Corporates group.
A REIT landlord that leases spaces to coworking provider under a traditional model is more credit friendly, but a fee-based model where the landlord has a better chance for greater cash flow risk is not as much.
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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.
April 18th
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.
April 18th
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.
April 18th
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.
April 18th
Flexibility in the workplace has become key in attracting talent, but properly implementing such arrangements ensures employees are fully satisfied with the organization.
April 18th
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.
April 17th
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.
April 17th
Coworking firm WeWork has reportedly backed out of at least five negotiations to occupy office space in Hong Kong, possibly indicating the company’s financial restraints.
April 17th
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.
April 17th
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.
April 17th
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.
April 17th
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.
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