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The overall area occupied by co-working space operators in Singapore has increased sharply over the past four years, according to a JLL report.
“In Singapore, flexible work space footprint by major operators tracked in the report has grown by 70 percent to 0.9 million sq ft by the end of 2017 from 0.5 million sq ft at the end of 2014,” said the property consultancy’s research head, Tay Huey Ying.
“They have capitalised on the soft rental environment amid an influx of new supply to expand their footprint to grab market share. This is particularly the case in the central business district where URA’s statistics showed close to 4 million sq ft of net new supply came on stream between 2014 and 2017.”
Including operators not tracked in the report, their total footprint is estimated to have reached 2.1 million sq ft last year, making up only 2.5 percent of the overall supply.
“While flexible space operators are still on an expansion spree, we expect their footprint to remain below 5.0 percent of islandwide office stock over the long term. However, including flexible space in corporates, this could increase to 30 percent by 2030”, noted Tay.
Among the reasons for the robust demand for co-working spaces by companies is its plug-and-play simplicity and no requirement for fit out and complicated contract negotiations, while tenants can move in and out at short notice.
Moreover, JLL revealed that the demand for flexible offices like co-working spaces and serviced offices is growing faster in Asia Pacific than anywhere else in the world.
In fact, the region’s supply of flexible work premises rose 35.7 percent annually versus 21.6 percent in Europe and 25.7 percent in the US. The number of major operators in the region has also doubled, while total footprint surged by 150 percent between 2014 and 2017.
Meanwhile, City Developments Limited (CDL) and Chinese co-working space operator Distrii revealed last week that their flexible working space at Republic Plaza in Raffles Place is 60 percent occupied ahead of its official opening in July.
Clients that have already committed to take up space in Distrii Republic Plaza include global blockchain incubator BitTemple, which has agreed to rent the entire fifth floor.
Measuring 62,000 sq ft across six levels, Distrii’s first overseas co-working centre is also its biggest facility in Singapore. It houses more than 900 work stations, a customisable team space, private offices, a multi-purpose event hall that can accommodate up to 200 people, and a F&B facility operated by German burger chain Hans im Glück.
CDL and Distrii have also inked an IT joint venture, whereby the latter will exclusively create smart office and building apps for the property developer in Southeast Asia.
The apps will be soft-launched at Republic Plaza by the first half of next year as part of the building’s asset enhancement initiative.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
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