Coworking spaces aren’t just for entrepreneurs anymore

When Maria Trujillo started her own graphic design firm, Aqui Designs, she tried working from home for a month but that didn’t last long.

“I needed to have a broader range of interactions each day,” she told CNBC.

Her solution: “I found a coworking space to work in where I have had the chance to find like-minded people and grow the human connections I was missing from working at home.”

An added benefit, Trujillo said, is she can now meet clients in the space. A year after joining The Working Capitol — which has two locations in Singapore — she said much of her new business comes from people she’s meeting in the coworking community.

While Trujillo’s story is not uncommon for entrepreneurs in coworking spaces, more corporations are finding value in using the facilities for at least a portion of their staff.

HSBC, for one, recently staffed 300 employees inside a space run by WeWork in Hong Kong.

The move toward enterprise tenants is part of WeWork’s long-term business strategy. It’s current roster around the globe includes the likes of Microsoft, GE, Dell, Sales Force and Deutsche Bank.

WeWork is now valued at $20 billion, according to CB Insights. The company has gone from just 1,000 members between two locations in New York in 2010, to more than 130,000 members across 163 locations today.

From June 2016 to June 2017, the number of enterprise companies using WeWork grew by 90 percent, while the number of members from enterprise companies increased by 360 percent, according to a WeWork company spokeswoman.

A large part of WeWork’s growth is also expected to take place in Asia, where it recently announced it had raised $1.4 billion in an investment led by SoftBank to expand in China, Japan and Southeast Asia.

The demand for coworking spaces in Asia is expected to grow 10 to 15 percent annually, according to real estate firm Cushman & Wakefield and association CoreNet Global.

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WeWork announced it will soon open three locations in Singapore, marking its first foray into Southeast Asia.

Despite a global coworking giant entering her market, Jaelle Ang, who recently opened coworking space The Great Room in the city-state, projected confidence.

Ang, a real estate developer, has recently pivoted her work toward developing and operating luxury coworking spaces.

The Great Room, is inspired by a luxury hotel and is attracting a growing number of corporations in addition to start-ups.

“A year ago, many multinational corporations would not consider being in a coworking space, but what a difference a year makes,” Ang said. “As I see it on the ground, coworking is the fastest growing asset class and it is here to stay.”

Many companies “put a premium on the flexibility and pay-as-you-grow nature of coworking,” she added.

In 2018, Ang said, The Great Room will be in at least six locations including Singapore, Bangkok, Jakarta and Hong Kong.

Ang attributed three growth drivers behind the coworking sector’s fast expansion: continued growth of start-up culture, a more flexible globalized workforce being fueled by technology, and the millennial generation. That cohort, Ang said, is embracing and demanding facets of the sharing and experience economy.

The growth is likely to continue to change the landscape of office real estate.

“There will be different offerings and brands to suit the various segments in the markets,” she said. “Similarly, commercial building owners will become more educated and conscientious about which coworking brand to align their building with.”

This article was originally published in: https://www.cnbc.com

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