There is a modest body of evidence that all is not entirely well. Already this spring Regus-owned IWG revealed a profits fall and plans to close some of its UK offices. Earlier, in February 2019, the Regus subsidiary running the 71,000 sq ft business centre at Heathrow Stockley Park applied for voluntary liquidation after it emerged it had not paid any rent since the start of October 2018.
And its not just Regus/IWG with some serious thinking to do. WeWork, the barnstorming poster-child of the coworking revolution, suffered a sudden jolt of financial reality in January 2019 when Japanese funder, Softbank, decided to slash its investment. According to the Financial Times, the value of the investment plunged from $16 billion in late 2018 to $2 billion.
Meanwhile, a flood of new entrants to the coworking and flex-space market has left everyone wondering how they can compete for customers in such a crowded market. This reporter discovered how deep the crisis was on a mid-week morning in Manchester: one coworking operator had taken to leafletting passers-by to drum up business.
Birmingham is probably the best place to measure the market. That is because growth in serviced and flexible floorspace has been rapid but, so far, without the turbo-charged effect of a WeWork presence. WeWork is understood to be close to taking three new hubs in the city, including 96,000 sq ft at Brindleyplace, with further outlets at Snowhill and Paradise Circus.
Is Birmingham excited? Well, er, not very. Charles Toogood is Birmingham-based National Head of Offices at agency, Avison Young, and he says the mood is fairly cool.
‘The city is probably less excited than Manchester or London,’ he says. ‘Maybe that is because we have more professional occupiers, who don’t much use coworking, and Manchester and London have more creatives and media, who do?’