The Executive Centre finds a market with in-house baristas, plush sofas in the luxury niche of Hong Kong's co-working space

By Cheryl Arcibal cheryl.arcibal@scmp.com / https://www.scmp.com/property/hong-kong-china/article/3007114/executive-centre-finds-market-house-baristas-plush-sofas?utm_medium=partner&utm_campaign=contentexchange&utm_source=EdgeProp | April 23, 2019 6:21 PM SGT
Office space operator The Executive Centre (TEC) believes that it has found a market in the luxury niche of Hong Kong's growing number of co-working space operators, as a strategy to survive the overcrowded market.
"I think of [the co-working sector] as the economy class of a flight," said TEC's chairman and chief executive Paul Salnikow. "We create locations across Asia where multinationals can settle in."
Multinational firms (MNCs), which make up 76 per cent of clients, stay with TEC for 36 months on average, three times the industry's tenancy, and for a 50 per cent premium over the rates offered by other co-working space providers like WeWork, Salnikow said.
Founded in 1994, TEC has over 130 centres in 32 cities, in 14 countries, mostly in Asia, including Australia and the United Arab Emirates. It provides private, virtual, and co-working spaces, each equipped with the usual meeting facilities, video conferencing and business concierge services. But TEC claims to do one better, offering in-house baristas, plush sofas and elegant meeting rooms comparable to the best in upscale hotels, the executive said.
The Executive Centre's locations in Hong Kong include Prosperity Tower, Three Garden Road, and One IFC Hong Kong, among others. Photo: Handout
"What [other co-working operators] fail to realise is that renting space and fitting it out is just the beginning of the journey," he said, adding that the renewal rate is 3.3 times. "You have to have a reason for people to occupy your space over and over again."
Co-working space operators currently occupy about 2.16 million square feet (200,000 square metres) in Hong Kong, according to global real estate services Savills, doubling in size since the end of 2017.
Paul Salnikow, founder and chief executive of The Executive Centre, on 26 March 2015. Photo: SCMP