• Events
  • Marketplace
  • Resources
  • Press Releases
  • Business Directory
  • Advertise
  • About Us
  • Contact
  • Submit to Allwork.Space
Saturday, January 28, 2023
Allwork.Space
The FUTURE OF WORK® since 2003
Find A Flexible Office Here
  • All Topics
    • Business
    • Biophilic Design
    • Career Growth
    • Coliving
    • Collaboration
    • Coworking
    • CRE
    • DE&I
    • Digital Nomads
    • Future of Work
    • Home Office
    • Human Resources (HR)
    • Hybrid Work
    • Investment
    • Leadership
    • Marketing
    • Mental Health
    • Mergers & Acquisitions
    • Office Furniture
    • Productivity
    • PropTech
    • Remote Work
    • Self-care
    • SMBs
    • Social Impact
    • Space-as-a-Service
    • Technology
    • Virtual Office
    • Work-life Balance
    • Workforce
    • Workplace Design
    • Workplace Wellness
  • News
  • Business
    Flexible Work and Investment in ESG are Driving Profitability for this Global Brand

    Flexible Work and Investment in ESG are Driving Profitability for this Global Brand

    Disney’s Imagination Has Failed

    Disney’s Imagination Has Failed

    Can COVID Booster Shots Save Your Business?

    Can COVID Booster Shots Save Your Business? 

    Three Culture-Building Steps To Create A World-Class Company

    Three Culture-Building Steps To Create A World-Class Company

    How To Manage Partnership Risks In The Future Of Work

    How To Manage Partnership Risks In The Future Of Work

    What It Takes To Be A Hybrid LeaderWhat It Takes To Be A Hybrid Leader

    Dr. Gleb Tsipursky CEO Of Disaster Avoidance Experts | What It Takes To Be A Hybrid Leader

    HR Leaders Share How New Salary Transparency Laws Have Changed Everything

    HR Leaders Share How New Salary Transparency Laws Have Changed Everything

    Don’t Be Adidas: Making Better Decisions Fast Is Important For Business Leadership

    Don’t Be Adidas: Making Better Decisions Fast Is Important For Business Leadership

    Are Productivity Paranoia and Lack of Trust the Real Obstacles to Hybrid and Remote Work?

    Are Productivity Paranoia And Lack Of Trust The Real Obstacles To Hybrid And Remote Work?

  • Tech
    3 Steps To Build A Three-Dimensional Hybrid Workplace

    3 Steps To Build A Three-Dimensional Hybrid Workplace

    PETER MISCOVICH

    Peter Miscovich JLL Global Future Of Work Leader | The Hybrid Workplace Evolution: Unlocking The Future Of Work

    AI Is Transforming The Future Of Industrial Work

    AI Is Transforming The Future Of Industrial Work

    Reimagining Offices for Hybrid Work

    Reimagining Offices for Hybrid Work: Frameable.com CEO on the Future of Virtual Offices

    How AI Can Help The Humans Within Human Resources

    HR Professionals Are Burned Out. Can A.I. Help?

    FOWP Adam Riggs

    Adam Riggs CEO Of Frameable | Can a Virtual Experience Really Replace the Office?

    Five Ways Tech Will Change The Ways We Work In 2023

    2023 Future Of Work Forecast: Five Ways Tech Will Change The Ways We Work In 2023

    Six Steps To Start A Coworking Center In The Metaverse

    Six Steps To Start A Coworking Center In The Metaverse

    Could Meta Be the Solution to Zoom Fatigue?

    Meta Wants To Fix Ongoing Zoom Fatigue — But You’ll Be Waiting A While

  • Marketing
    2023 Future Of Work Forecast: Focus Marketing On Values and Customer Experience, Not The Product

    2023 Future Of Work Forecast: Focus Marketing On Values and Customer Experience, Not The Product

    Want Your Coworking Newsletter to Actually Convert

    Want Your Coworking Newsletter to Actually Convert? Start by Keeping It Simple, Fun, and Consistent

    5 Pros Share How To Use Instagram To Grow Your Coworking Business

    5 Pros Share How To Use Instagram To Grow Your Coworking Business

    Want To Wow Coworking Members

    Want To “Wow” Coworking Members? It All Starts With (The Right) Insights

    6 Free, High-Quality Photo Sites To Level Up Your Marketing

    6 Free, High-Quality Photo Sites To Level Up Your Marketing

    The Creator Economy Is Dramatically Changing Marketing Practices, Here’s Why

    The Creator Economy Is Dramatically Changing Marketing Practices, Here’s Why

    Everything You Need To Know About Google My Business, And How To Ace It

    Everything You Need To Know About Google My Business, And How To Ace It

    Nothing Beats In-Person Communication, But These Online Tools Come Pretty Close

    Nothing Beats In-Person Communication, But These Online Tools Come Pretty Close

    6 Tips For Capturing More Website Leads

    6 Tips For Capturing More Website Leads

  • Design
    The Secret Formula To Determine How (And How Often) Your Employees Should Work In The Office

    The Secret Formula To Determine How (And How Often) Your Employees Should Work In The Office

    Create A Neurodiverse Friendly Office In Just One Minute

    Start Creating A Neurodiverse Friendly Office In Just One Minute

    Get Employee Buy-in To Make Office Redesigns Matter

    Get Employee Buy-in To Make Office Redesigns Matter

    How To Make Your Hybrid Office Accessible To All

    How To Make Your Hybrid Office Accessible To All

    Design Of Smart Office Spaces In The Post Pandemic World

    The Future Of Work Demands Futuristic Office Tech

    Designing Leadership Spaces for Hybrid Work

    Designing Leadership Spaces for Hybrid Work

    Resources And Tips To Harness The Power Of Interior Design For Environmental Impact — And Employee Retention

    Resources And Tips To Harness The Power Of Interior Design For Environmental Impact — And Employee Retention

    Designing Human Centric Workplaces Is Key To Hybrid Program Success

    Designing Human-Centric Workplaces Is Key To Hybrid Program Success

    2023 Future Of Work Forecast: Designing Offices For Evolving Workforce Needs

    2023 Future Of Work Forecast: Office Design Is Ever-Evolving; Here Are 5 Trends For 2023

  • Work-life
    What’s Your Job Worth In The Future Of Work?

    What’s Your Job Worth In The Future Of Work?

    3 Ways To Burn Fat At Work

    3 Ways To Burn Fat At Work

    Key

    Unlock Your Hidden Benefits

    8 Crucial Tax Filing Tips For Freelancers

    8 Crucial Tax Filing Tips For Freelancers

    Update Your Home Office For A Fresh, Focused New Year

    Update Your Home Office For A Fresh, Focused New Year

    gift ideas for digital nomads

    12 Last-Minute Gift Ideas For Digital Nomads

    A Guide For Workspace Mental Health Communication

    A Guide For Workspace Mental Health Communication

    Who’s Stuck With The Bill?

    Who’s Stuck With The Bill?

    How To Avoid Unlimited PTO Chaos — Even During The Holidays

    How To Avoid Unlimited PTO Chaos — Even During The Holidays

  • CRE
    Rapid Work Style Shifts Are Tanking Tax Revenues — Can City Planners Catch Up?

    Rapid Work Style Shifts Are Tanking Tax Revenues — Can City Planners Catch Up?

    San Francisco Skyline

    The Future of Commercial Real Estate in San Francisco Doesn’t Look Good

    3 Things CRE Players Must Do To Stay Relevant In 2023

    2023 Future Of Work Forecast: 3 Things CRE Players Must Do To Stay Relevant In 2023

    The Office Space Sector Is Projected To See A Strong Fourth Quarter In 2022

    The Office Space Sector Is Projected To See A Strong Fourth Quarter In 2022

    Meet Flex Space More Chaotic Cousin Gray Spaces

    Meet Flex Space’s More Chaotic Cousin: Gray Spaces

    The Future Of Our Offices And Our Planet Hinges On The Real Estate Industry Priorities

    The Future Of Our Offices — And Our Planet — Hinges On The Real Estate Industry’s Priorities

    JLL New Future Of Work Survey The Next Few Years Are Crucial For Commercial Real Estate (2)

    JLL’s New Future Of Work Survey: The Next Few Years Are Crucial For Commercial Real Estate

    What Is The Impact Of Hybrid Working On Space Optimization

    What Is The Impact Of Hybrid Working On Space Optimization?

    What Can We Expect For The Future Of Office Occupancy?

    What Can We Expect For The Future Of Office Occupancy?

  • Coworking
    How To Apply For Digital Nomad Visas In 4 Idyllic Work Destinations

    How To Apply For Digital Nomad Visas In 4 Idyllic Work Destinations

    I'm an Independent Coworking Center Operator Thriving in a City with 9 WeWorks

    I’m An Independent Coworking Center Operator Thriving In A City With 9 WeWorks

    Data Tracking Software Gives Coworking Operators Competitive Advantage

    Data Tracking Software Gives Coworking Operators Competitive Advantage

    The Story Behind WeWork’s Failed Locations

    The Story Behind WeWork’s Failed Locations

    What Is An “Open” Coworking Space? 

    What is an “Open” Coworking Space?

    The Pandemic’s Lasting Impact on the Future of Coworking

    The Pandemic’s Lasting Impact on the Future of Coworking

    What Does “Community” Mean In Coworking?

    What Does “Community” Mean In Coworking? Your Answer Matters

    Is WeWork Going Bust?

    Is WeWork Going Bust?

    The Secret To Attracting New Occupants

    The Secret To Attracting New Occupants

  • Workforce
    Is Marc Benioff of Salesforce Right That You Can't Integrate Junior Staff Remotely?

    Is Marc Benioff of Salesforce Right That You Can’t Integrate Junior Staff Remotely?

    4 Monumental Ways Banning Noncompete Clauses Will Transform The Future Of Work

    4 Monumental Ways Banning Noncompete Clauses Will Transform The Future Of Work

    What To Do If You’ve Been Quietly Promoted

    What To Do If You’ve Been Quietly Promoted

    Nurture Skills To Retain Employees

    Nurture Skills To Retain Employees

    The Four Horsemen of the Mandated Return to Office

    The Four Horsemen of the Mandated Return to Office

    Indeed & Glassdoor Economists Predict Continued Hiring Challenges

    Indeed & Glassdoor Economists Predict Continued Hiring Challenges

    Will Remote Work Be A Mandated Right In The Future Of Work?

    Will Remote Work Be A Mandated Right In The Future Of Work?

    Why It’s Time to Retire the Term Hybrid Work

    Why It’s Time to Retire the Term “Hybrid Work”

    Reverse Mentoring: The Benefits Of Learning From Your Employees

    Reverse Mentoring: The Benefits Of Learning From Your Employees

  • Podcast
  • Subscribe
  • All Topics
    • Business
    • Biophilic Design
    • Career Growth
    • Coliving
    • Collaboration
    • Coworking
    • CRE
    • DE&I
    • Digital Nomads
    • Future of Work
    • Home Office
    • Human Resources (HR)
    • Hybrid Work
    • Investment
    • Leadership
    • Marketing
    • Mental Health
    • Mergers & Acquisitions
    • Office Furniture
    • Productivity
    • PropTech
    • Remote Work
    • Self-care
    • SMBs
    • Social Impact
    • Space-as-a-Service
    • Technology
    • Virtual Office
    • Work-life Balance
    • Workforce
    • Workplace Design
    • Workplace Wellness
  • News
  • Business
    Flexible Work and Investment in ESG are Driving Profitability for this Global Brand

    Flexible Work and Investment in ESG are Driving Profitability for this Global Brand

    Disney’s Imagination Has Failed

    Disney’s Imagination Has Failed

    Can COVID Booster Shots Save Your Business?

    Can COVID Booster Shots Save Your Business? 

    Three Culture-Building Steps To Create A World-Class Company

    Three Culture-Building Steps To Create A World-Class Company

    How To Manage Partnership Risks In The Future Of Work

    How To Manage Partnership Risks In The Future Of Work

    What It Takes To Be A Hybrid LeaderWhat It Takes To Be A Hybrid Leader

    Dr. Gleb Tsipursky CEO Of Disaster Avoidance Experts | What It Takes To Be A Hybrid Leader

    HR Leaders Share How New Salary Transparency Laws Have Changed Everything

    HR Leaders Share How New Salary Transparency Laws Have Changed Everything

    Don’t Be Adidas: Making Better Decisions Fast Is Important For Business Leadership

    Don’t Be Adidas: Making Better Decisions Fast Is Important For Business Leadership

    Are Productivity Paranoia and Lack of Trust the Real Obstacles to Hybrid and Remote Work?

    Are Productivity Paranoia And Lack Of Trust The Real Obstacles To Hybrid And Remote Work?

  • Tech
    3 Steps To Build A Three-Dimensional Hybrid Workplace

    3 Steps To Build A Three-Dimensional Hybrid Workplace

    PETER MISCOVICH

    Peter Miscovich JLL Global Future Of Work Leader | The Hybrid Workplace Evolution: Unlocking The Future Of Work

    AI Is Transforming The Future Of Industrial Work

    AI Is Transforming The Future Of Industrial Work

    Reimagining Offices for Hybrid Work

    Reimagining Offices for Hybrid Work: Frameable.com CEO on the Future of Virtual Offices

    How AI Can Help The Humans Within Human Resources

    HR Professionals Are Burned Out. Can A.I. Help?

    FOWP Adam Riggs

    Adam Riggs CEO Of Frameable | Can a Virtual Experience Really Replace the Office?

    Five Ways Tech Will Change The Ways We Work In 2023

    2023 Future Of Work Forecast: Five Ways Tech Will Change The Ways We Work In 2023

    Six Steps To Start A Coworking Center In The Metaverse

    Six Steps To Start A Coworking Center In The Metaverse

    Could Meta Be the Solution to Zoom Fatigue?

    Meta Wants To Fix Ongoing Zoom Fatigue — But You’ll Be Waiting A While

  • Marketing
    2023 Future Of Work Forecast: Focus Marketing On Values and Customer Experience, Not The Product

    2023 Future Of Work Forecast: Focus Marketing On Values and Customer Experience, Not The Product

    Want Your Coworking Newsletter to Actually Convert

    Want Your Coworking Newsletter to Actually Convert? Start by Keeping It Simple, Fun, and Consistent

    5 Pros Share How To Use Instagram To Grow Your Coworking Business

    5 Pros Share How To Use Instagram To Grow Your Coworking Business

    Want To Wow Coworking Members

    Want To “Wow” Coworking Members? It All Starts With (The Right) Insights

    6 Free, High-Quality Photo Sites To Level Up Your Marketing

    6 Free, High-Quality Photo Sites To Level Up Your Marketing

    The Creator Economy Is Dramatically Changing Marketing Practices, Here’s Why

    The Creator Economy Is Dramatically Changing Marketing Practices, Here’s Why

    Everything You Need To Know About Google My Business, And How To Ace It

    Everything You Need To Know About Google My Business, And How To Ace It

    Nothing Beats In-Person Communication, But These Online Tools Come Pretty Close

    Nothing Beats In-Person Communication, But These Online Tools Come Pretty Close

    6 Tips For Capturing More Website Leads

    6 Tips For Capturing More Website Leads

  • Design
    The Secret Formula To Determine How (And How Often) Your Employees Should Work In The Office

    The Secret Formula To Determine How (And How Often) Your Employees Should Work In The Office

    Create A Neurodiverse Friendly Office In Just One Minute

    Start Creating A Neurodiverse Friendly Office In Just One Minute

    Get Employee Buy-in To Make Office Redesigns Matter

    Get Employee Buy-in To Make Office Redesigns Matter

    How To Make Your Hybrid Office Accessible To All

    How To Make Your Hybrid Office Accessible To All

    Design Of Smart Office Spaces In The Post Pandemic World

    The Future Of Work Demands Futuristic Office Tech

    Designing Leadership Spaces for Hybrid Work

    Designing Leadership Spaces for Hybrid Work

    Resources And Tips To Harness The Power Of Interior Design For Environmental Impact — And Employee Retention

    Resources And Tips To Harness The Power Of Interior Design For Environmental Impact — And Employee Retention

    Designing Human Centric Workplaces Is Key To Hybrid Program Success

    Designing Human-Centric Workplaces Is Key To Hybrid Program Success

    2023 Future Of Work Forecast: Designing Offices For Evolving Workforce Needs

    2023 Future Of Work Forecast: Office Design Is Ever-Evolving; Here Are 5 Trends For 2023

  • Work-life
    What’s Your Job Worth In The Future Of Work?

    What’s Your Job Worth In The Future Of Work?

    3 Ways To Burn Fat At Work

    3 Ways To Burn Fat At Work

    Key

    Unlock Your Hidden Benefits

    8 Crucial Tax Filing Tips For Freelancers

    8 Crucial Tax Filing Tips For Freelancers

    Update Your Home Office For A Fresh, Focused New Year

    Update Your Home Office For A Fresh, Focused New Year

    gift ideas for digital nomads

    12 Last-Minute Gift Ideas For Digital Nomads

    A Guide For Workspace Mental Health Communication

    A Guide For Workspace Mental Health Communication

    Who’s Stuck With The Bill?

    Who’s Stuck With The Bill?

    How To Avoid Unlimited PTO Chaos — Even During The Holidays

    How To Avoid Unlimited PTO Chaos — Even During The Holidays

  • CRE
    Rapid Work Style Shifts Are Tanking Tax Revenues — Can City Planners Catch Up?

    Rapid Work Style Shifts Are Tanking Tax Revenues — Can City Planners Catch Up?

    San Francisco Skyline

    The Future of Commercial Real Estate in San Francisco Doesn’t Look Good

    3 Things CRE Players Must Do To Stay Relevant In 2023

    2023 Future Of Work Forecast: 3 Things CRE Players Must Do To Stay Relevant In 2023

    The Office Space Sector Is Projected To See A Strong Fourth Quarter In 2022

    The Office Space Sector Is Projected To See A Strong Fourth Quarter In 2022

    Meet Flex Space More Chaotic Cousin Gray Spaces

    Meet Flex Space’s More Chaotic Cousin: Gray Spaces

    The Future Of Our Offices And Our Planet Hinges On The Real Estate Industry Priorities

    The Future Of Our Offices — And Our Planet — Hinges On The Real Estate Industry’s Priorities

    JLL New Future Of Work Survey The Next Few Years Are Crucial For Commercial Real Estate (2)

    JLL’s New Future Of Work Survey: The Next Few Years Are Crucial For Commercial Real Estate

    What Is The Impact Of Hybrid Working On Space Optimization

    What Is The Impact Of Hybrid Working On Space Optimization?

    What Can We Expect For The Future Of Office Occupancy?

    What Can We Expect For The Future Of Office Occupancy?

  • Coworking
    How To Apply For Digital Nomad Visas In 4 Idyllic Work Destinations

    How To Apply For Digital Nomad Visas In 4 Idyllic Work Destinations

    I'm an Independent Coworking Center Operator Thriving in a City with 9 WeWorks

    I’m An Independent Coworking Center Operator Thriving In A City With 9 WeWorks

    Data Tracking Software Gives Coworking Operators Competitive Advantage

    Data Tracking Software Gives Coworking Operators Competitive Advantage

    The Story Behind WeWork’s Failed Locations

    The Story Behind WeWork’s Failed Locations

    What Is An “Open” Coworking Space? 

    What is an “Open” Coworking Space?

    The Pandemic’s Lasting Impact on the Future of Coworking

    The Pandemic’s Lasting Impact on the Future of Coworking

    What Does “Community” Mean In Coworking?

    What Does “Community” Mean In Coworking? Your Answer Matters

    Is WeWork Going Bust?

    Is WeWork Going Bust?

    The Secret To Attracting New Occupants

    The Secret To Attracting New Occupants

  • Workforce
    Is Marc Benioff of Salesforce Right That You Can't Integrate Junior Staff Remotely?

    Is Marc Benioff of Salesforce Right That You Can’t Integrate Junior Staff Remotely?

    4 Monumental Ways Banning Noncompete Clauses Will Transform The Future Of Work

    4 Monumental Ways Banning Noncompete Clauses Will Transform The Future Of Work

    What To Do If You’ve Been Quietly Promoted

    What To Do If You’ve Been Quietly Promoted

    Nurture Skills To Retain Employees

    Nurture Skills To Retain Employees

    The Four Horsemen of the Mandated Return to Office

    The Four Horsemen of the Mandated Return to Office

    Indeed & Glassdoor Economists Predict Continued Hiring Challenges

    Indeed & Glassdoor Economists Predict Continued Hiring Challenges

    Will Remote Work Be A Mandated Right In The Future Of Work?

    Will Remote Work Be A Mandated Right In The Future Of Work?

    Why It’s Time to Retire the Term Hybrid Work

    Why It’s Time to Retire the Term “Hybrid Work”

    Reverse Mentoring: The Benefits Of Learning From Your Employees

    Reverse Mentoring: The Benefits Of Learning From Your Employees

  • Podcast
  • Subscribe
No Result
View All Result
Allwork.Space
No Result
View All Result
  • News
  • Business
  • Tech
  • Marketing
  • Design
  • Work-life
  • CRE
  • Coworking
  • Workforce
  • Podcasts
  • Subscribe
Nexudus May Leaderboard
Home CRE

Why IWG Is Undervalued

IWG has long been undervalued, but this could be about to change, says industry investment expert Jonathan Price.

by Jonathan Price
February 9, 2021
in CRE
Reading Time: 5 mins read
A A
Why IWG Is Undervalued
Share on FacebookShare on TwitterShare to Network
Find a remote job with Flexjobs
  • Jonathan Price analyses IWG’s competitive advantage over other flexible space companies and questions why it has long been undervalued. 
  • IWG’s lean cost structure and large footprint of suburban and smaller city/town locations is helping it through the pandemic crisis “relatively unscathed”. 
  • The company’s long-term franchise strategy and “war chest of capital” sets it apart from other operators, and could drive a significant re-rating. 

Over my 20+ years being professionally involved in finance and investment in serviced offices, I have been largely unimpressed with research into the sector. Prior to 2005, interest in flexible space was so limited that no-one had thought it worthwhile to do any analysis, let alone publish any research. 

As a result, the Business Centre Association, as it was then, had to cajole property firm DTZ into publishing the first ever research by effectively promising that a working group, which I chaired, would do all the work for them. 

Sixteen years later the situation has vastly improved with regular analysis on the market being published by the Instant Group and Allwork.Space over a number of years, and more recently by the big property services groups like JLL and C&W, plus equity market analysis on the small number of quoted companies and on WeWork – more about them later. 

The improved quantity of research does not necessarily mean improved quality and analysis of the listed companies, like IWG plc, has tended to be superficial and cliché ridden. If I had a penny for every time I have read that Mark Dixon, IWG’s CEO, used to sell hotdogs, I’d be a rich man. 

So it is noteworthy when you come across a really good piece of analysis, as I did last week on the financial website, Seeking Alpha. 

The piece in question, entitled ‘IWG plc: A Cheap Cyclical Compounder’, was written by Belgian analyst, Thomas Coppens. In it, Coppens explains what the flexible market is, and what is driving growth in the market, which regular readers of Allwork.Space will be familiar with, but also analyses in depth IWG’s competitors and its competitive advantage over them. 

He also considers IWG’s long term strategy — to be a franchisor, rather than an operator — which sets it apart from other operators, and then speculates on how it might use the war chest of capital it has built up through recent issues of shares and convertible bonds. 

The three most important factors of profitability in serviced offices are, scale, scale and scale. Despite not being an industry analyst, Coppens has grasped this essential point and analysed the right and the wrong ways to go about building scale, considering IWG and WeWork respectively. 

Looking at the EBIT margins for new business centres opened by the two operators, he notes that the initial losses were much higher for WeWork than for IWG, which he suspects was caused by the very aggressive pricing of the former. He quotes with approval Mark Dixon’s comment that many former competitors of Regus, IWG’s main brand, went bust because they focussed on revenue, not profit. 

IWG shows us that the key to profitable growth is cost discipline. Over the past five years IWG has had a relentless focus on squeezing costs, reducing SG&A from 20% of revenue down to 10% as the footprint has doubled. This enabled it to withstand the margin reduction pressure exerted by WeWork and other competitors. 

Another key factor in IWG’s success is maximising ancillary revenues from telephony, IT, virtual offices, and so on. Because of its size, IWG is also able to offer disaster recovery services in a credible way that other smaller operators could not. In total IWG’s accounts have 120 lines of ancillary revenues. 

The move into franchising is an important move for IWG but not a new one. 

While it was still called Regus, it made two attempts to push franchising, both of which failed to gain traction. This time around it seems to have got both the timing and the business model right with sales of Master Franchise Agreements for three important countries — Japan, Taiwan and Switzerland — to major investors raising around $600 million in upfront cash with a continuing stream of franchise fees to follow. Coppens also reports that a much larger deal to franchise all or part of IWG’s largest geographical market, the USA, would have been signed in 2020, were it not for Covid-19. 

Talking of the pandemic, IWG has suffered much less from centre closures than have its competitors such as WeWork and Knotel. 

The reason IWG has come through relatively unscathed, and is likely to continue to prosper is that, unlike its competitors, it has a very large footprint of suburban and smaller city/town locations. Although these locations are not as profitable as city centres in normal times, Mark Dixon understood very early on the importance of having a diversified range of locations to offer different customer groups. Indeed he discussed with me, more than ten years ago a project to systematically locate and engage with business centre operators in small to medium sized towns and cities in the UK with a view to bringing them into the Regus network. It is precisely these locations that remain open and at good levels of occupancy today, while prestigious locations in deserted city centres have been abandoned by staff reluctant to commute, or not allowed to. 

Of course, IWG’s lean cost structure also helps in difficult times as does the fact that the vast majority of its locations are leased on terms that are ring-fenced so as to prevent local bankruptcies having a domino effect, or incorporate break clauses limiting the financial exposure. IWG is also famous for its tough negotiating style with landlords. 

What does the future hold for IWG? 

Coppens thinks that the company is undervalued by the market at today’s price of 355p and that it could be worth as much as 1200p per share. What would drive such a re-rating? Having seen off WeWork, there is no other meaningful competitor in sight and IWG is flush with cash available to make strategic purchases of operators suffering pandemic distress – Coppens estimates this cash pile at £860 million, but I think it is over £1 billion. 

In addition to this, there is the prospect of more cash arriving if the deferred US franchise deal does close. 

One thing is certain – it would be foolish to bet against IWG. One of the UK’s noted bears, Simon Cawkwell, aka Evil Knievel, insisted on shorting Regus back in 2001, despite my advice not to, and lost £2 million of his personal cash as a result. 

Despite a compound annual growth rate (CAGR) of 24% in the decade 2010-2020, flexible space still only accounts for 2-3% of total office space globally. The long-term structural trend will take that number to 20% in my view, a view which I have held for 20 years. Coppens largely agrees predicting continued 15-30% CAGR until 2030 which at the top end would take the share of flexible space up to 30%. He could be right. In either case, IWG can double from where it is today and double again. 

Under the astute leadership of Mark Dixon, architect of its successful strategy, it could well do so. He says he’s not in it for the money. Perhaps not, but he’s going to have a lot of it anyway. 

Later Ad
Tags: BusinessCRE
Jonathan Price

Jonathan Price

Jonathan is a Chartered Fellow of the Chartered Institute for Securities & Investment and was responsible for the world’s first ever public fund for investment in coworking space. Today he acts as a specialist consultant and is a visiting professor at a leading French business school.

No Result
View All Result

SCOPE by Allwork.Space

Prepare for the Future of Work – straight to your inbox, for free.

* indicates required
We take your privacy seriously, your e-mail is safe with us.
ORND Learn More
Fiverr Ad
Yardi
Top online courses in Career Development

Listen to the experts themselves

News and Features

Business

Tech

Marketing

Design

Work-life

CRE

Coworking

Workforce

Daily Digest

Podcast

Resources

Marketplace

Events

Press Releases

FlexSpace, Coworking
and Office Space

Los Angeles

New York

Chicago

Washington, D.C.

Houston

Dallas

Miami

San Francisco

Atlanta

Philadelphia

Seattle

Austin

Company

About Us

Submit to Allwork.Space

Contact

Advertise

FlexSpace

Terms Of Use

FlexSpace FAQs

Privacy Policy

Connect with Allwork.Space

Twitter

Linkedin

Facebook

Instagram

YouTube

Apple Podcasts

Spotify

Google Podcasts

©2022 Allwork.Space  l  Exploring the FUTURE OF WORK® since 2003.

No Result
View All Result
  • Daily Digest
  • Podcasts
  • Events
  • Resources
  • Marketplace
  • Business Directory
  • Subscribe
  • Advertise
  • Find Space
  • About Us
  • Submit to Allwork.Space

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
-
00:00
00:00

Queue

Update Required Flash plugin
-
00:00
00:00