Swire signs deal with WeWork in HK development

HONG KONG: Swire Properties Ltd has signed an agreement with WeWork Cos to lease four floors providing about 55,000 sq ft in a commercial tower in Taikoo Shing, the first deal between the co-working space provider and a major listed Hong Kong developer.

Swire didn’t disclose the rent to be paid by WeWork, but said it would pay the going market rate in Citiplaza 3, a 24-storey, grade-A office building eight subway stops from the Central business district.

Hong Kong has been slower than other financial centres to embrace co-working spaces because landlords have felt no pressure to provide them when traditional tenants keep occupancy rates in the Central business district at almost 100%.

Still, Don Taylor, Swire’s director of office leasing, said that major companies that move to less expensive alternatives outside Central are now seeking something beyond the traditional fixed lease. “Corporations are saying to us, ‘ do you have flex space?’” Swire operates its own co-working space called Blueprint in its Quarry Bay office complex, but that only has room for about 200 employees and WeWork will provide greater scale to tenants.

New York-based WeWork currently operates two facilities in Hong Kong, though those spaces are leased from smaller landlords in Wan Chai and Causeway Bay, which are outside the central business district.

It also has plans to open in a former hotel in the entertainment district of Lan Kwai Fong. — Bloomberg