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WeWork’s growth was held back after a controversial year in 2019. But the company is looking to bounce back in 2020.
WeWork Southeast Asia managing director Turochas Fuad revealed that the company has no plans of scaling back its operations in Singapore despite 2019 being a controversial year for them, reported Channel News Asia.
Once reaching a value of almost US$50 billion (S$67.3 billion), the company’s growth was held back after it filed its IPO prospectus in August 2019.
Potential investors heavily scrutinised its finances (it recorded a US$1.25 billion loss in 3Q 2019) and leadership under former CEO Adam Neumann.
The former CEO stepped down from his position following reports of his excessive partying ways and conflicts of interest with the company’s business.
This resulted in WeWork’s value falling to below US$8 billion (S$10.7 billion) and its plans for IPO getting shelved.
In October 2019, Japanese investment firm SoftBank announced it was abandoning WeWork, which cost the co-working operator US$9.5 billion (S$12.7 billion) in investments.
Following that withdrawal, the company laid off about 2,400 employees worldwide in November 2019, in an effort to make the company more efficient.
“Has it been fun? Not really. It’s never a fun exercise but it did make us stronger,” said Fuad.
He believed that the “right-sizing” which WeWork went through was an exercise which affected Singapore and Southeast Asia, though he did not say how many jobs got affected in the region.
Fuad said in the two years that it has been in the country, the company has learned how to increase profitability faster.
He also emphasised that WeWork has no plans of scaling back its efforts in Singapore.
It will soon occupy 14 floors in the MYP Centre along Battery Road, on top of its currently-occupied three floors.
“It will continue to sign more leases and locate more buildings, and make sure we find the right ones”, he said.
WeWork currently has 12 co-working spaces in the country, with the largest area at Funan mall measuring at more than 6,500 sq m (69,965 sq ft) across three storeys.
WeWork Singapore is currently expanding to areas in Alexandra Road, Collyer Quay and Raffles Place.
Meanwhile, the company’s businesses in Ho Chi Minh, Kuala Lumpur, Bangkok, Jakarta and Manila are “definitely on the right track”, said Fuad.
“We’re still in the process of tracking, but they’re trending well and we expect them to hit the same kind of trajectory as Singapore,” he noted.
When asked how WeWork could compete in an increasingly crowded sector, Fuad said its global presence was its advantage against other competitors.
He explained that WeWork currently has operations in 600 locations in 33 countries, allowing it to expand to locations such as South Africa and Japan.
Fuad also boasted that the company has accumulated 10 years’ worth of “art and science” in customising clients’ workspaces.
“Aesthetically you can see that other companies can kind of follow and do similar things, but how we design our offices, what size, what usage, that’s all 10 years’ worth of data,” he said.
Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg
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