SINGAPORE: Although WeWork has filed for bankruptcy in the United States, demand for co-working spaces remains strong in Singapore, analysts told CNA.
The SoftBank Group-backed startup, which sought US bankruptcy protection on Monday (Nov 6), said it has entered into a restructuring agreement with key stakeholders to drastically reduce its existing funded debt. It also intends to file similar proceedings in Canada.
The company’s locations outside of the US and Canada, as well as its franchisees around the world, are not affected by these proceedings, it added.
A spokesman for WeWork Singapore said it is “business as usual” and that customers can continue using its 14 offices here.
WeWork first opened its doors in Singapore in 2017. Last September, it opened its 14th outlet in the country at 21 Collyer Quay near Raffles Place – WeWork’s largest location in Asia Pacific at over 220,000 sq ft.
Noting that WeWork Singapore’s operations are not likely to be affected by the bankruptcy, real estate analysts CNA spoke to also highlighted that the demand for co-working spaces in Singapore is “very strong”.
Some co-working operators are seeing occupancy rates between 90 and 100 per cent, and are looking to expand especially in the city centre, said Huttons Asia’s senior director for data analytics Lee Sze Teck.
Mr Alan Cheong, executive director of research and consultancy at Savills, highlighted that furnished spaces occupied by WeWork would find “ready takers” to fill the spot. These may be co-working entities formed by building owners where WeWork is located or competitors stepping up as substitute operators.
Only unfitted office space without furnishing and locations that are performing below the margin are likely to be negatively affected by the bankruptcy.
“Co-working has a place in the new workplace arrangement. With WeWork out of the picture, the competition is reduced, making it easier for others with the same business model to restructure for another fighting chance in the game,” said Mr Cheong.