Co-working becomes mainstream amid economic uncertainty
By Valerie Kor
/ EdgeProp Singapore |
SINGAPORE (EDGEPROP) - Since September last year, businesses in Singapore have been given the green light to allow half of their workforce to return to the office for half of the time. Following the start of Phase Three on Dec 28, restrictions on workers returning to offices may be relaxed soon, said Manpower Minister Josephine Teo in December last year.
While this has not yet been confirmed, being able to go back to office in the near future is welcome news for workers who are struggling to work from home (WFH). “The novelty of WFH has worn off for some, especially in Singapore where homes are smaller, and multi-generational living is common. Although some like that they don’t have to commute, others crave the distinction between home and office,” says Narita Cheah, co-founder of workplace consultancy PaperSpace Asia, which operates co-working space PaperWork.
Brandon Chia, vice president and head for Singapore and Indonesia at JustCo, concurs: “In the second half of 2020, people started to realise that long-term remote working is not sustainable as the mix of community, connectivity, culture and spontaneity in a physical workplace is irreplaceable.”
Currently, JustCo has about 40% of members back in their spaces at any one time, says Chia. “As Phase Three has commenced from Dec 28, we expect more members to return to their offices in 1Q2021,” he adds.
JustCo’s latest workspace at The Centrepoint, spanning three storeys, is home to Tencent-backed Riot Games and cosmetic giant L’Oreal (Photo: JustCo)
With cases under control in Singapore and Covid-19 vaccines being rolled out, the co-working industry is experiencing a recovery. “In response to the pandemic, some companies had a knee-jerk reaction to the new normal of WFH, and reduced their flexible workspace requirements to cut costs,” says Justin Chen, CEO of Arcc Spaces. The company opened its flagship centre One Marina Boulevard in August 2020 and saw occupancy levels rise from 30% in the first month to 50% in December.
Similarly, co-working space PaperWork, based in the National Design Centre, saw around 10% attrition in tenancy from 1Q2020 to 3Q2020, but tenancy has since recovered. “We were very worried when we hit the circuit breaker. Interestingly, however, we are seeing more individual ‘solopreneurs’ signing up recently,” says Cheah. “Smaller companies, which could actually function fully with full WFH arrangements, are also coming back as [the employees] miss the physical connection,” she adds.
Transition ground
In fact, the normalisation of hybrid work modes have presented new opportunities for the co-working sector. Its flexibility has proved to be a boon for companies which are adopting a look-and-see approach as the pandemic settles.
At JustCo, although there were members that had to scale down their offices, or that were unable to renew their memberships as their businesses were hit by the pandemic, the co-working operator has received new enquiries from larger businesses that wanted to move out of their traditional office spaces as they rethink work arrangements and their real estate strategy, says Chia.
PaperWork may be expanding to lease more space in the National Design Centre in the coming year (Photo: PaperSpace Asia)
“The pandemic has sped up the adoption of co-working, with more traditional businesses recognising the value of a flexible workspace — such as lease flexibility, members engagement programmes, networking and collaboration opportunities,” he adds.
Arcc Spaces’ Chen says that the company has also started to receive enquiries from tech, finance and consulting firms, which were leasing traditional office space and seeking an alternative. “Co-working allows them to save on capital and operational expenditure, as well as expand and reduce their size in a short period of time,” he adds.
Having someone else implement and enforce health and safety measures is also one of the upsides of working from a co-working space during a pandemic, says Michelle Yong, co-founder and CEO of Found8, a co-working operator that has locations at Amoy Street, North Bridge Road and Anson Road in Singapore, as well as a centre in Kuala Lumpur.
For young start-ups and smaller enterprises, co-working offers shorter leases as well as a community. “They can relinquish their rental expenses more quickly when needed,” says JustCo’s Chia. They also do not need to think about how to plan spaces, what furniture to buy, how to set up programmes for staff, and so on, which gives them more time to focus on growing their businesses, says PaperSpace’s Cheah. If they need to scale up later, they can choose to take up more space within the co-working facility, she adds.
Arcc Spaces’ new centre at One Marina Boulevard saw occupancy levels increase from 30% to 50% from August to December last year (Photo: Arcc Spaces)
For these reasons, foreign companies setting up their bases in Singapore are also adopting co-working. In October last year, Chinese technology giant Tencent Holdings subscribed to 200 desks at JustCo’s co-working space in OCBC Centre East at Raffles Place. The lease will run for a year.
In fact, JustCo’s Chia points out that co-working has become more commonplace for enterprises globally, not only in Singapore. ByteDance-owned Tik Tok and Thailand-based super app Kasikorn Line also took up desks at JustCo’s newly launched space at Amarin Plaza in Bangkok.
“Singapore has positioned itself as a regional hub with ease of doing business and political neutrality. The city is an attractive base for companies interested in Asean to set up headquarters here,” says Arcc Spaces’ Chen.
Found8’s Yong also believes that Singapore is a hotbed and gateway for the growing tech industry, which will in turn benefit the co-working sector. In particular, certain verticals, such as HealthTech, RegTech, InsurTech and AI, have actually benefitted from the pandemic, she adds.
Leveraging new tech
JustCo has deployed 30 soundproof work booths across nine malls in partnership with PropTech app Switch (Photo: JustCo)
Co-working spaces are now leveraging new technologies to reach more users and optimise space. When Covid-19 started to spread, one of the more pertinent tasks for co-working spaces was to ensure the health and safety of members by installing contactless technologies.
At JustCo’s latest co-working space at The Centrepoint, launched in November last year, members enter via facial recognition, and there is a fully automated Ratio cafe that is powered by robotics and AI.
At PaperWork, access to the space is also by facial recognition. When teams exit and enter, the meeting rooms are fully sanitised, much like in a gym.
JustCo has partnered with Switch, owned and operated by PropTech studio REinvent, to launch the world’s first on-demand workspace that charges by the minute. JustCo has deployed 30 soundproof work booths across nine malls, which members can unlock through an app-connected smart door lock and pay $3.60 per hour to work in. The booths will also provide secured WiFi, electric sockets and a Bluetooth speaker.
Co-working operators can also list their places on digital platforms such as FlySpaces and GorillaSpace to reach out to individual users, who can filter their search by categories such as area, price, and amenities, and book spaces via the platforms.
PaperWork’s entry system uses facial recognition software (Photo: PaperSpace Asia)
There are also technologies that can be used to maximise the usage of space. “Motion sensors can help you track behaviour of users, such as how much time staff spend sitting on their actual desks, standing up, drawing, or at the communal area. The data collected can help you to maximise the usage of the space,” says PaperSpace’s Cheah.
JustCo has recently partnered SixSense, a spatial analytics technology company. It is able to monitor crowdedness for safe distancing purposes and users can view real-time information on centre density through the app. They can then choose suitable workspaces to go to. This data will also be used by JustCo’s design team to improve office design and construction, says Chia.
Moving forward, PaperWork has plans to take up more space within the National Design Centre. The company, which has locations in Singapore, Bangkok and Philippines, is also eyeing expansion to India, starting from Mumbai and Delhi.
Meanwhile, Arcc Spaces is in discussions with different landlords in the global market and will be looking at opening facilities in cities where it does not have a presence yet, such as Tokyo and Shenzhen. It currently has 17 centres across Singapore, Kuala Lumpur, Beijing, Hong Kong and Shanghai.
Expansion plans are also on track for JustCo. In 2020, it opened three new spaces in Singapore and one centre each in Melbourne, Bangkok, Taiwan and Seoul. In 2Q2021, JustCo will be opening its next centre at Razer SEA HQ in one-north. It is also seeking to expand to Japan following its latest joint venture with Daito Trust, a listed construction and real estate company in Japan.
“We believe that the future of work belongs to flexible and on-demand workspaces. Employees will be empowered to decide where and how they work to achieve the best productivity,” says JustCo’s Chia.
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