Flexible working operators to snap up 550,000 sqft of office space by end-2019
There are 141 such players located across Singapore.
Co-working spaces are expected to take up 550,000 sqft of Singapore’s office market in 2019, according to property consultant Colliers International. Although the figures will fall short of the 570,000 sqft occupied by flexible coworking spaces in 2018, Colliers still lauds Singapore as the most mature market for co-working spaces in Asia.
In 2013-2018, the number of flexible office set-ups more than doubled and its market size expanded by three times in the five-year period, data from CBRE show. As of June 2019, approximately two in five office buildings in Singapore currently have some sort of flexible office component.
Across the island, there are 141 flexible workspace centres where average desk cost per month amount to $776.82 (US$573) whilst average Grade A rents are $115.23 (US$85) psf pm, according to data from the report. This is cheaper compared to Hong Kong’s average desk cost per month and average Grade A rents of $1,005 (US$741) and $164 (US$121), respectively.
“The flexible workspace market in Singapore has been largely concentrated in the core CBD within Grade A buildings. However, as the market has grown operators have sought opportunities in fringe locations such as Tanjong Pagar and Orchard Road,” Colliers International director Bastiaan Van Beijsterveldt said in a report.
The report noted that WeWork is the most aggressive amongst operators in terms of expansion. Currently, the New York-based operator occupies 95,000 sqft at MYP Centre in Raffles Place.
“However, several local operators made significant strides – JustCo’s investment from Frasers and GIC has accelerated growth, and The Work Project and The Great Room are delivering premium, hospitality-driven product across the market,” Beijsterveldt added.
Furthermore, landlords have increased exposure to flexible workspace over 2018. For its part, CapitaLand invested $27m for a 50% stake in The Work Project. Thes kinds of partnerships with landlords are expected to strengthen in 2019, the director said. “We should see M&A take place, especially with international operators looking at leveraging local market knowledge as a way of entering the market.”