IWG seeks to improve balance sheet and get better returns on capital through franchising

IWG is taking a page out of McDonalds’ playbook by rolling out a franchise model that was pioneered by the fast food company back in the 1950s.

The flexible office provider currently has 555,000 workstations worldwide and builds out spaces in commercial office buildings for its Regus and Spaces brands, then subleases the space to companies on short-term, flexible leases.

With the new model, the company will outsource this process to its franchisees as it works to widen the gap between itself and major competitor WeWork.

Just this week, the company sold 130 of its spaces in Japan to TKP Corporation for $419.1 million.