One of Hong Kong’s biggest co-working leasing deals has added to an explosion in the number and size of such agreements.
Start-up Campfire Collaborative Spaces leased three floors of the Harbourfront Landmark building in western Kowloon from private equity firm Pamfleet Real Estate Fund LP, according to Colliers International Group Inc., which brokered the transaction.
Record co-working deals in Hong Kong in 2018 show their growing role in the office market amid the rise of companies such as WeWork Cos., the U.S. firm reported to have claimed a valuation of $35 billion. Co-working companies accounted for 10 percent of new lettings on Hong Kong Island last year, according to Jones Lang LaSalle Inc.
“For the next six to 12 months, we will continue to see co-working operators expanding in the market,” said Denis Ma, head of Hong Kong research at JLL. “A lot of operators are trying to gain market share because it’s very much a new sector.”
BIGGEST CO-WORKING LEASES IN HONG KONG
WeWork: 93,000 square feet, Tower 535, Causeway Bay
Kr Space Ltd.: 86,000 square feet in One Hennessy, Wan Chai
Campfire: 80,000 square feet in Harbourfront Landmark
The firms’ appetite for space is increasing dramatically, with 592,000 square feet (55,000 square meters) leased in grade A and grade B buildings citywide this year, 64 percent more than in all of 2017, according to Colliers.
“There will be continued growth although market dynamics in Hong Kong mean year-on-year take up will unlikely match the heights” of 2018, said Jonathan Wright, Colliers International’s director of flexible workspace services.