John Williams, CMO, The Instant Group, comments: “The news that WeWork will launch an imminent Initial Public Offering shows beyond all doubt that flexible workspace (coworking) has now become a mainstream part of the real estate market.
“One of the latest ‘unicorns’ to set out its intention to IPO, with an expected valuation of over $47 billion based on further SoftBank investment in January this year, it is more evidence not only of confidence in this market but also in the brand to take advantage of changing client demand from leases to ‘flexible’ workspace.”
The Instant Group, which has the oldest and broadest set of data on the global flexible workspace market, is available to provide data and commentary about this and its broader meaning for the flex and overall office sector. The scale of the flexible workspace industry is huge – and growing. Despite operating over 560 locations globally and being the largest single office tenant in Manhattan, WeWork proportionately makes up only a very small part of the highly fragmented flexible workspace industry. Instant’s industry research shows that WeWork operates just 2.2% of all spaces globally, while in the leading markets of the UK and the US their presence is only fractionally larger at 2.3%.
“In the US and the UK, only IWG, which owns Regus and Spaces, offers more flexible workspace locations while WeWork now provides more spaces than the subsequent two largest providers combined thanks to the high growth. But there are more than 35,000 flexible workspace locations, according to Instant’s current tracking, and this number is increasing every day.
“There is undoubtedly room for WeWork to grow as client demand for flex space increases by 25% each year and the brand expands into new markets across the world. Inevitably some of this expansion will include consolidation as among the 35,000 flexible workspace centers there are more than 5,000 operators, the vast majority of which run only one or two centres.”