Home Top News IWG upbeat on PHL co-working space sector, points to high occupancy

IWG upbeat on PHL co-working space sector, points to high occupancy

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MULTINATIONAL office solutions firm International Working Group plc (IWG) said it expects to have over 40 locations in the Philippines by the end of 2024.

“By the end of this year, we will have more than 40 locations, and last year we barely had 20. We are also by far the fastest growing, and the largest with our network here in the Philippines,” IWG Country Manager for the Philippines Lars Wittig said during a press briefing last week.

IWG recently launched four new centers in May, bringing the total spaces to 31. These include two Regus centers: one in Nepo Center, Angeles City, Pampanga, on May 6 and the Adriatico, Manila, on May 10. Meanwhile, the HQ Triumph building in Quezon City opened on May 14, and Spaces in PNB Makati on May 15.

According to Mr. Wittig, the investment cost for a new center is roughly $1 million, including the cost of amenities such as Wi-Fi connection, coffee maker, and more.

Moreover, these spaces will be concentrated in Metro Manila with 27 spaces, and three centers each in Pampanga and Davao. Baguio, Subic, Cebu, Iloilo, and Cagayan de Oro all have one, respectively. A center in Cavite will launch in November.

Mr. Wittig said he is bullish on the co-working space industry in the Philippines and noted IWG’s 85% minimum occupancy rate every single month for 18 months.

IWG’s expansion plans were driven by growing demand for the industry due to the employment boom while employers preferring to have less long-term office space in conventional settings, he said.

The company also cited the 2023 Asia Pacific Workforce Hopes and Fears Survey, which revealed that about 51% of Philippine respondents preferred the hybrid work model. This preference coincides with rising foreign investment, strong gross domestic product figures, and the growing affluence in the trend.

“In COVID, [employers] learned the hard way that once you sign a lease for five or 10 years and make a big capital investment to fill it,” he said, while noting that employers do not stand a realistic chance of truly knowing what their workspace requirements will be in the future.

He also said that relatively smaller businesses find leasing requirements overwhelming and expensive when dealing with traditional landlords.

“While the whole real estate market for commercial office space might look a little bit bleak, the shining star in it all is flexible workspace as a service,” he said.

Globally, IWG leads the flexible workspace industry, with almost 10 million customers in 4,000 locations across more than 120 countries. — Aubrey Rose A. Inosante

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