WeWork struck its first deal with a major publicly listed developer in Hong Kong.
The co-working company signed an agreement to lease four floors with roughly 55,000 square feet at Swire Properties’ 24-story Cityplaza 3 tower in Taikoo Shing, Bloomberg reported.
The class-A office tower is eight subway stops away from the Central business district. The rent was not disclosed, but Swire said WeWork will pay market rate.
WeWork already operates two facilities in Hong Kong. But those are outside the central business district and leased from smaller landlords in Wan Chai and Causeway Bay. The company plans to open in a former hotel in the Lan Kwai Fong entertainment district.
Hong Kong has been slower than other financial centers to grab ahold of the co-working trend en masse, partly because landlords have not felt the pressure with occupancy rates at nearly 100 percent.
Office space in Hong Kong’s Central district costs an average of $323 per square foot – 66 percent more than Midtown Manhattan.
But Don Taylor, Swire’s director of office leasing, said major companies are now looking for more options.
“Corporations are saying to us, ‘do you have flex space?’” he said. Swire operates its own coworking space called Blueprint, but only has room for roughly 200 employees.
WeWork last year raised $500 million for its expansion in the South Korean and Asian markets. [Bloomberg] – Rich Bockmann