Tenants eye alternative providers amid questions about WeWork’s future, while industry occupancy rates remain high.
SINGAPORE: Despite WeWork’s recent bankruptcy filing in the United States, analysts suggest that demand for co-working spaces in Singapore remains strong. The SoftBank-backed company, which filed for Chapter 11 protection on November 6, stated that its locations outside the US and Canada, including its 14 Singapore offices, are unaffected by the proceedings.
WeWork Singapore, operating since 2017, continues “business as usual,” according to its spokesperson. Its most recent addition, a 220,000 sq ft office at 21 Collyer Quay, is WeWork’s largest in the Asia-Pacific region.
Resilient Demand for Co-Working Spaces
The co-working market in Singapore is thriving, with occupancy rates for some operators reaching 90 to 100 percent, said Lee Sze Teck, senior director at Huttons Asia. “Many operators are expanding, particularly in the city center,” he added.
Savills’ Alan Cheong echoed these sentiments, noting that if WeWork were to exit, its spaces would find “ready takers,” likely from competitors or building owners looking to establish in-house co-working brands. Only unfurnished or underperforming locations would face challenges, he said.
“Co-working remains a valuable element in the evolving workplace ecosystem,” said Mr. Cheong, suggesting that WeWork’s troubles could benefit other players by reducing competition.
Tenant Concerns Amid Uncertainty
While existing operations in Singapore continue, questions about WeWork’s long-term stability are influencing tenant decisions.
Potential tenants may opt for other providers until WeWork’s future is clearer, said Mr. Cheong. Existing clients, however, are bound by current leases, with many considering short-term renewals given co-working’s flexible contracts.
Shivaji Das, managing director at Frost and Sullivan Asia-Pacific, observed potential price pressures on WeWork due to tenant concerns. Shorter tenancy agreements make closures less disruptive but could push tenants to negotiate lower rates or consider other options.
Casa Mia Coliving, a co-living company based at WeWork’s Clemenceau Avenue office, has explored alternatives but appreciates the flexibility offered by WeWork. “This location suits us because of its proximity to our River Valley properties, and there are limited flexible office options nearby,” said CEO Eugenio Ferrante.
Future Outlook
While WeWork’s Singapore operations remain stable for now, tenants like Frost and Sullivan and Casa Mia are adopting a wait-and-see approach. The broader co-working sector in Singapore, buoyed by strong demand, appears poised to weather any turbulence arising from WeWork’s financial challenges.
