WeWork

CapitaLand's revamped Funan secures 98% pre-leasing commitment for twin office blocks

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THE twin office blocks of CapitaLand's revamped Funan integrated development has garnered 98 per cent pre-leasing commitment of its total office net lettable area (NLA) of 214,000 square feet (sq ft).

The CapitaLand Mall Trust-owned (CMT) Funan secured the pre-leasing commitment of about 210,000 sq ft of its NLA when it got its Temporary Occupation Permit in April.

Funan’s office tenants, which comprise public agencies, multinational corporations and startups, are slated to move into the two six-storey blocks progressively from the second-quarter of 2019.

The south office block, which has a total NLA of 95,600 sq ft, has been fully leased to three public agencies: the Attorney-General’s Chambers, Singapore Department of Statistics and the Smart Nation and Digital Government Office.

The north block's office tenants include German sporting goods company adidas' South-east Asia office and co-working space WeWork.

"The revamped Funan caters to the new generation of professionals who prefer to work in a collaborative and inspiring environment, at a convenient location where they can unwind at the end of the day with a whole host of lifestyle amenities under one roof," said Tony Tan, CEO of CapitaLand Mall Trust Management.

"With a high commitment of 98 per cent, Funan’s diversified and quality office tenant base will progressively contribute earnings to CMT from 3Q 2019.”

CapitaLand shares closed up 0.85 per cent, or S$0.03 at S$3.57 on Tuesday, while CapitaLand Mall Trust units also closed up 0.82 per cent, or S$0.02 at S$2.45.

Source: Business Times, 8 May 2019

Office-sharing startup WeWork files for stock market listing

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WEWORK, the fast-growing office-sharing startup, said on Monday it had filed documents for a stock market listing to help fuel further expansion.

The New York-based firm valued at some US$47 billion by private investors and operating in some 600 cities worldwide, said it filed its registration confidentially last December with the Securities & Exchange Commission.

The confidential filing allows the company to begin the listing process before divulging key financial and business information.

"This process will enable WeWork to make the decision to become publicly traded, subject to market and other conditions," WeWork said in a statement.

WeWork has taken the lead in the co-working space and in the process is disrupting the office and real estate market with smartly designed offices, often with free-flowing beer and coffee.

Started in 2010, WeWork has hundreds of thousands of customers from individual entrepreneurs to Fortune 500 companies needing temporary or permanent office space.

The monthly deals can be particularly attractive to independent workers who do not want to make a long-term commitment.

But WeWork also rents to employees of large firms such as IBM where regional offices are less convenient.

In January, Japanese tech giant SoftBank invested some US$2 billion in the company as it rebranded itself as "The We Company".

WeWork offered no details on how much money it would seek to raise, its valuation or the timing of its offering.

But the news comes amid a wave of listings from Silicon Valley "unicorns", or startups worth at least US$1 billion, including Lyft, Pinterest, Slack and Uber.

In 2017, WeWork agreed to buy the Lord & Taylor flagship store on New York's Fifth Avenue in Manhattan in a sign of the disruption of the real estate market.

Separately, it was announced in Singapore on Tuesday that WeWork will open its second WeWork Labs location at 380 Jalan Besar in May.

WeWork has also been recognised as a Startup SG Founder Accredited Mentor Partner (AMP) by government agency Enterprise Singapore.

The Startup SG Founder scheme provides mentorship and startup capital grant to first-time entrepreneurs with innovative business ideas, with ESG providing up to S$30,000 by matching S$3 for every dollar raised.

Industry leaders as appointed AMPs identify qualifying applicants based on the uniqueness of business concept, feasibility of business model, strength of management team, and potential market value.

Source: Business Times, 1 May 2019

String of public agencies lease offices at Funan

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A STRING of government bodies have leased office space at the revamped Funan in the North Bridge Road/Hill Street location.

These include the Department of Statistics (DOS) , organ of state Attorney-General's Chambers (AGC) and the Smart Nation and Digital Government Office (SNDGO), which are leasing a total of about 8,590 sq m (or 92,462 sq ft) of net lettable office space in the South Tower office block of Funan.

The Ministry of Culture, Community and Youth (MCCY) will be taking 360 sq m.

The Government Technology Agency (GovTech) will occupy 170 sq m there - but this will be within the co-working facility to be operated by WeWork in the building's North Tower office block.

The Business Times understands that WeWork has increased the space it is leasing at Funan from 40,000 sq ft to 70,000 sq ft.

DOS, which will move to Funan later this year, now operates out of The Treasury next door.

"DOS works closely with many of the agencies in The Treasury, and being in Funan will facilitate these work interactions. DOS will be occupying about 5,000 sq m in Funan's South Tower office block, similar to its current office space at The Treasury," a Ministry of Finance (MOF) spokesman told BT.

MOF owns The Treasury and is also housed there. Also in the building are the Trade and Industry and Law ministries, the Prime Minister's Office Strategy Group, the Public Service Division and Accountant-General's Department.

The roughly 20-year-old Treasury has about 24,000 sq m (about 258,334 sq ft) net lettable area (NLA).

The space now occupied by DOS at The Treasury will be taken up by other government units, said the MOF spokesman.

An AGC spokesman told BT that by early next year, part of the AGC will be relocated to Funan, where it will occupy about 1,790 sq m in the South Tower.

"This is in line with AGC's need for more office space in order to accommodate the increased headcount to manage the government-wide increase in demand for legal services," she added.

The organ of state operates out of One Upper Pickering in Chinatown near the State Courts. It has a long lease for the whole of the 15-storey office building, which has about 87,070 sq ft NLA.

The AGC began operating from there in March 2013.

Market watchers note that a presence at Funan will place the AGC near the Supreme Court Building, which houses the High Court and Court of Appeal. It also marks the AGC's return to where it once was - in leased premises at The Adelphi - before its move to One Upper Pickering.

That move was triggered by a lease expiry; the landlord had said then that it had plans for the premises, it was reported.

SNDGO's spokesman told BT that it will move to Funan's South Tower by year's end, taking up about 1,800 sq m. "The relocation would better meet SNDGO's needs," he added.

The agency is now in Raffles City Tower.

GovTech's spokesman told BT that it will be taking co-working space at Funan to work more closely with SNDGO to "build digital solutions for citizens and businesses".

The two agencies make up the Smart Nation and Digital Government Group (SNDGG). Funan, redeveloped from the former Funan DigitaLife Mall, has about 887,000 sq ft gross floor area. It comprises a retail component (held through CapitaLand Mall Trust or CMT), two office towers (held by trusts fully owned by CMT), and the lyf co-living serviced residences. The serviced residence component is owned by a fully-owned subsidiary of Ascott Serviced Residence (Global) Fund.

Retail tenants in the development include Golden Village, FairPrice Finest and theatre company Wild Rice. The mall will use experiential retail concepts with the integration of online, offline, data and logistics offerings.

Source: Business Times, 9 Apr 2019

Co-working space provider WeWork opens new location at 380 Jalan Besar

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WEWORK is augmenting its presence in Singapore with its new location at 380 Jalan Besar, the US-based co-working space provider announced in a press statement on Tuesday.

The new space, which opened its doors on March 1, is housed in ARC 380, a mixed-purpose commercial development, and marks the firm's first location with additional amenities such as a sky terrace with a swimming pool, a gym and an open rooftop, WeWork said.

The group's first location outside the central business district will host a total of more than 380 members, the company added.

As part of its expansion plans, the opening of its next location at 109 North Bridge Road (Funan) is also in the pipeline for the second quarter this year.

WeWork currently has 10 spots in Singapore under its network of spaces, with Funan set to be the eleventh.

According to the company, WeWork 380 Jalan Besar is well positioned on the city fringes close to the central district, and the Marina Bay Financial Centre in District 8. The nearest MRT stations include Bendemeer station on the Downtown line, Lavender station on the East-West line, and Boon Keng on the North-East line.

In addition, City Square Mall and the upcoming Paya Lebar Commercial Hub will also be nearby.

Said managing director of WeWork South-east Asia, Turochas Fuad: "Singapore is at the epicentre of a high growth region with ambitious and capable startups and enterprises hungry for success. We see this as an opportunity for WeWork to grow in lockstep with enterprises to businesses of all sizes, where we support them in building a dynamic and creative community in Singapore, as they expand their footprints across South-east Asia.

"Our growing presence in Singapore is a testament to WeWork's commitment to reshaping the future of work, empowering our members to grow and thrive, while creating tangible economic value in the markets that we operate in," added Mr Fuad.

Source: Business Times, 5 Mar 2019

WeWork aims for mid-sized firms with expanded 'HQ' service

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HQ by WeWork is targeting 11 overseas markets including London and Shanghai and other US hot spots such as Boston and Denver

WEWORK is expanding an effort to retain mid-sized businesses which had been leaving the shared office space manager after they grew past the small-company phase, and to catch up with rivals already catering to these clients.

HQ by WeWork, launched in San Francisco and New York in August to provide enhanced services for businesses with 11 to 250 employees, is targeting 11 overseas markets including London and Shanghai and other US hot spots such as Boston and Denver, said executives at WeWork, a unit of The We Company.

The US$42 billion New York-based "unicorn" in 2010 helped pioneer "coworking", or shared desk-space, with a focus on startups, entrepreneurs and freelancers.

WeWork has been losing clients as they grew to more than a dozen or so employees and found that sharing office space no longer suited their needs.

"Those companies were within the platform, but we weren't going out of our way to serve them," David Fano, chief growth officer at WeWork, said in an interview. "Some of the companies were saying, 'Look, we really just want our own space'."

The new service aims to help fill that gap between WeWork's signature coworking platform and its offering for large companies with more than 1,000 employees.

"That's our ultimate dream, that companies stay with us for life. From being a single-person startup to the day that they're Airbnb," Mr Fano said.

HQ by WeWork marks a departure from its coworking model of shared space as companies seek to build their own identity and environment, a service that Knotel, but few others operating flexible office space, has seized on exclusively.

Flexible office space gained its name from shorter-term leases than landlords typically offer, and their operators build out spaces that have services and are more fashionable.

Minimum leases for HQ by WeWork are two years and companies gain Wi-Fi, IT and audiovisual systems, along with access to WeWork's global network of shared space and conference rooms.

Knotel recently said it has completed more than 2 million square feet of deals in Manhattan, or double that of HQ by WeWork.

Industrious, a rival flex-space startup, in January said teams of 20 or more people make up its fastest-growing segment.

The initiative marks a shift where WeWork is no longer seen as taking incremental space from landlords with its coworking model but is competing with them for traditional clients even as they still lease the property owner's space.

About 13 per cent of HQ by WeWork members are previous clients. WeWork was unable to say how many potential HQ clients had left its operations.

But WeWork expects the HQ segment to account for some 70,000 of a projected overall membership base of 800,000 by year's end, or double WeWork's 400,000 members in January.

A member is any individual working in a WeWork location.

WeWork last year became the largest private leasor of office space in Manhattan and operates almost 100 sites in New York City. WeWork told bond investors in November it was on track to post revenue of US$2.3 billion in 2018.

"The marketplace is being disrupted, the most telling sign for that is landlords are starting to bring their own product into the market," said Dom Harding, head of Workthere Americas, a new unit of brokerage Savills that provides consulting for companies seeking flexible office space.

Many mainstream real estate companies, such as developer Tishman Speyer, brokerage CBRE Group and Washington Real Estate Investment Trust, have spawned their own flexible office units to tap the demand for shorter-term leases.

HQ by WeWork has grown to 30 locations with almost one million sq ft under lease in its two launch cities.

The unit expects to have 270 locations open worldwide by the end of 2019 as it also targets office markets in Berlin, Toronto, Amsterdam, Jakarta, Sao Paulo, Los Angeles and Austin, Texas.

"WeWork continues to take bigger bites out of the existing tenant base instead of just pulling people out of coffee shops," said Alexander Snyder, a senior analyst at real estate-focused CenterSquare Investment Management in Philadelphia. REUTERS

Source: Business Times, 2 Mar 2019

WeWork set to grow Singapore footprint to over 300,000 sq ft

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It is said to have leased space at City House and Mapletree Anson and is in advanced talks for space in Suntec City, 8 Cross Street

US-based co-working space provider WeWork, which launched its operations in Singapore only last December, is set to expand its presence.

The Business Times understands that it has signed up at several new locations - including City House and Mapletree Anson - and is in advanced discussions at others, such as 8 Cross Street and Suntec Tower 5.

If things go according to plan, WeWork's footprint in Singapore would grow to over 300,000 sq ft. When contacted, its spokesman said: "We do not have any announcements at this stage."

Co-working spaces are open-plan office spaces offered to users on a desk-by-desk basis. Facilities such as pantries and meeting rooms are shared. Such spaces are sold by membership on a daily or monthly basis, but some co-working operators are entering into longer-term arrangements with big corporations that may require space for special projects on short notice without having to run up huge capital expenses.

WeWork's space in City House in Robinson Road is said to take up four floors, totalling about 34,000 sq ft on the lower floors of the 23-storey building. This is part of the space now occupied by building owner City Developments Limited (CDL) for its headquarters.

CDL will move its headquarters to the group's flagship office building Republic Plaza in Raffles Place later this year, to take up some of the space vacated by tenants such as Japanese bank MUFG, Itochu and ING, which have moved to newer buildings.

CDL made improvements such as lift upgrades, at City House last year.

At Mapletree Anson, WeWork is leasing a floor of about 20,000 sq ft that Lendlease vacated last year to move to a co-working space in OUE Downtown Gallery in Shenton Way; this move is for the interim, until Lendlease moves to Paya Lebar Quarter. WeWork is close to wrapping a deal to lease the top two floors of Suntec Tower 5, more than 30,000 sq ft in all. The space, which takes up Level 17 and the mezzanine area on Level 18, used to be occupied by UBS. The bank will retain a presence in the same tower, in addition to its premises in One Raffles Quay and Hansapoint in Changi Business Park.

Talk in the market is that WeWork is also in advanced talks to take four floors totalling 60,000 sq ft at 8 Cross Street.

Last month, Frasers Commercial Trust announced that WeWork had committed to a lease of about 28,700 sq ft in one of China Square Central's heritage shophouse blocks. WeWork will take up the space in phases, starting with 16,800 sq ft in the second half of this year.

WeWork, which launched its operations at Beach Centre, opens its second location at 71 Robinson Road this quarter; it will also begin operations next year in Funan's North Office block, where it has leased 40,000 sq ft.

Co-working operators helped to support demand for Singapore office space last year; the trend is expected to continue this year, but market watchers expect a shakeup among the space-providers at some stage. They range from homegrown start-ups to regional players; a handful of international names like Regus and WeWork make up the rest of the field.

JLL's head of Singapore markets Andrew Tangye, commented that the growth in the co-working space sector has been evident in nearly all global cities in the past couple of years. "Interest in this space taps into the trend of more flexible styles of working, fostering greater collaboration and creativity.

"Demand is coming not just from start-ups, but large organisations looking to house some of their teams in alternative work spaces.

"While co-working space has been well received here and demand is expected to grow further, the operators that will be successful and continue to grow are the ones that are able to differentiate their offerings and show value to customers. Those who fail to do so may be able to compete only on cost."

Among the leases tracked by CBRE Research, more than 500,000 sq ft of space in Singapore was signed by co-working operators in 2017.

Michael Tay, the executive director for advisory and transaction in the property consulting group, said: "This sector is going through a phase of exponential growth, which naturally generates concerns about the ability of the Singapore market to absorb this influx of co-working space."

He estimates that about 97 per cent of office occupiers in Singapore are still committed to conventional leases of, say, three or five years.

"In the longer term, the success of this sector will hinge on the ability of co-working operators to succeed in converting occupiers on conventional leases to take up more co-working space."

Source: Business Times, 8 Feb 2018

Co-working space startup WeWork calls Funan home

SINGAPORE - The manager of CapitaLand Mall Trust, Capitaland Mall Trust Management Limited, announced it has secured its first office tenant in Funan. Co-working start-up WeWork is leasing 40,000 sq ft of space in the integrated development.

WeWork's space will be located across two floors at Funan's North Office block, which is linked to the retail section of the development.

WeWork's co-working space will feature a smart office with facial recognition turnstiles and optional card-less entry into the office, said Tony Tan, chief executive of the trust manager.

Among other facilities at Funan, workers will also have access to "video-based smart car parking facilities, a 24-hour drive-through click-and-collect, hands-free shopping service using robotics and app-based booking of all the facilities within the development", added Mr Tan.

The upcoming Funan development features 500,000 sq ft of retail space, two Grade A office blocks, and The Ascott Limited's lyf brand of co-living serviced residence, all linked via a direct underpass to City Hall MRT interchange.

Amenities will include a Golden Village cineplex, a gym, a futsal court, a swimming pool and a 55-lane rock-climbing facility. According to CapitaLand, it will also be the first commercial building to allow cycling through the building with a dedicated indoor cycling path.

The site is slated for completion in the fourth quarter of 2019.

Source: Straits Times, 14 Dec 2017