WeWork's changing fortunes do not spell the end for flexible operators - Giles Fuchs in Property Week

1 min read
Published: 9 Mar 2021 9:29

The much publicised decline of WeWork has potentially significant consequences for the company’s tenants (who risk losing their business premises), employees (who have experienced a wave of staff cuts recently) and landlords (who are potentially facing large losses of income in unpaid rental arrears.

However, WeWork’s changing fortunes should not spell the end for flexible workspace operators. Potential investors, landlords and tenants should learn from WeWork, but not fall into the trap of turning their backs on the entire industry, says Giles Fuchs, CEO of Office Space in Town in his recent feedback letter in Property Week.

Giles notes that far from struggling the flexible workplace market continues to grow, with WeWork accounting for only 6% of flexible workspace demand.

The company now faces several issues; rapid expansion resulting in an excess of leased space, long rent-free periods and rental discounts resulting in cash flow problems, management and staff morale issues and ongoing problems with valuation.

However, these problems are not shared by the rest of a thriving global flexible workspace sector. While WeWork may fall by the wayside, the flexible office model is here to stay and only shows signs of growing in the future. People’s working habits and their demands of what they want from their working environments continue to change and evolve, in favour of more flexibility and freedom than the traditional office has given them.

Read the full article here