International Workplace Group (IWG), the world’s largest flexible office operator and parent of brands like Regus, Spaces, and HQ, opened more new locations in the first half of 2025 than it did during its entire first decade in business.
The rapid expansion is indicative of surging demand for local workspaces, especially in suburban and rural areas, as hybrid work patterns take hold, according to Coworking Europe.
In the U.S., IWG’s strategy reached towns such as Franklin, Texas (population under 5,000), Berwyn, Pennsylvania, and Bloomfield Hills, Michigan, as part of an effort to bring flexible offices closer to where people live.
Of the 496 new sites added globally, nearly all were launched under asset-light franchise or management agreements, allowing the company to grow without tying up capital.
The Managed & Franchised segment saw 26% revenue growth year-on-year, reaching $361 million in the first half. That performance was driven by a 43% rise in commissions and a 163% jump in recurring management fees.
IWG added 37,400 rentable “rooms” — 7m² workspace units — to its network, which now totals roughly 1 million rooms across 121 countries.
Revenue from IWG-owned centers held steady at $1.59 billion, with improved occupancy pushing adjusted gross margins up to 24%. However, the company’s Digital & Professional Services division saw a 7% drop in revenue to $207 million, though it recorded 6% underlying growth when excluding the impact of a lost contract.
Despite stable group-wide results, IWG shares fell over 15% after the company warned that full-year adjusted EBITDA would likely come in at the lower end of its $525–$565 million guidance.
CEO Mark Dixon cited increased investments in the franchising and management model as the reason for the revision but reaffirmed confidence in long-term demand.
