How IWG’s Business Model Is Impacting Its Mounting Debt

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IWG, one of the leaders in the flexible workspace industry, may be experiencing some turbulence in its current business model. 

This week, shares in IWG fell 10% following disappointing profits the company attributed to inflation, the war in Ukraine and Covid-19 lockdowns in China. 

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Beyond the impact that global events have had on the company, IWG is also struggling with mounting debts. In the first half of the year, IWG saw its net debt grow by 6% to £7.2 billion.

Rising debts paired with skyrocketing inflation in the UK and the US have left the sustainability of short-term office lease models in question.  

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While some companies are bound to rely on these flexible workspaces in lieu of large offices, it also leaves the company extremely vulnerable as businesses look for ways to cut costs. 

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