WeWork’s Business Doing Fine In Singapore
SINGAPORE – Even though WeWork recently warned that it’s at risk of going bankrupt, some Singapore-listed real estate investment trusts (S-REITs) that leases office space to the coworking space operator said WeWork’s business here is doing okay, reported The Edge on Thursday evening (10 August, SGT).
For Q2 2023, the coworking space operator saw a net loss of US$397 million, pushing its overall net loss for the first half of the year to US$696 million. At the end of the 2nd quarter, WeWork’s global physical occupancy dropped to 72 percent.
In Singapore, WeWork operates coworking spaces in some of CapitaLand Integrated Commercial Trust’s office properties, including the whole of 21 Collyer Quay, which was previously called the HSBC building. The coworking space provider is also an occupant at the S-REIT’s property at Funan.
Other S-REITs exposed to WeWork are Suntec REIT and Mapletree Pan Asia Commercial Trust in their respective properties of Suntec City’s Tower 5 and Mapletree Anson at 60 Anson Road. Yanlord Land Group’s UE Square also houses a coworking centre under the brand.
Another S-REIT, City Developments Limited (CDL), also leases office space to WeWork, namely City House in Singapore and St. Katharine Docks in London.
CDL’s Group COO Kwek Eik Sheng commented that the latest worrying news about WeWork “has to do with its US operations” as the country’s office market is facing a “challenging time”.
On the other hand, he revealed that the coworking space operator’s branches in City House and St. Katharine Docks have “strong” occupancies, and Singapore’s office sector is doing “pretty good”.
“WeWork has been prompt in paying its rentals so far, but of course, with the news, we’ll continue to monitor them closely,” added Kwek Eik Sheng.
Furthermore, CDL’s Group Chief Executive Sherman Kwek said they are comfortable with their exposure to WeWork at City House and St. Katharine Docks for the time being. The coworking space operator accounts for 2 to 3 percent of CDL’s gross rental income (GRI) from its Singapore office assets, while WeWork contributes around 9 percent of the overall revenue from the developer’s commercial property portfolio in the United Kingdom.