WeWork gets a lot of headlines for its breakneck expansion into new markets, and now it is planning to go public.
Yet the nine-year-old company faces stiff competition in Europe from established work-space providers.
The number of serviced and co-working offices across Europe has ballooned by 200% in the last five years, according to a report by real estate broker Colliers International.
WeWork has helped to drive this growth: It has 50 locations in London and has added sites, in places from Manchester to Moscow and Dublin.
“The IPO is a great milestone in the evolution of the flexible work-space scene,” said Tom Sleigh, head of consultancy on the industry at Colliers.
“It’s a signal to other operators that they’re able to expand,” he said.
While WeWork initially rose with an explosion of startups, big companies are increasingly seeking more flexible offices, too.
Corporate clients now make up a third of WeWork’s customers. IWG, which owns the Regus brand, has traditionally catered to corporate customers.
Today, we released our first Global Impact Report, which showcases the economic ripple effect of communities pursuing their purpose around the world. Here's to those who do heroic work every day and exemplify the We movement. Find out more at https://t.co/7j3I9mJec9. #wework pic.twitter.com/gTPMDoADTO— WeWork (@WeWork) April 29, 2019
WeWork and IWG account for about 78% of the European market for flexible work-space, Colliers data show.
WeWork had about 600,000 square metres (6.5 million square feet) of office space in Europe at the end of 2018.
That put it ahead of IWG, whose Spaces brand is more closely comparable to WeWork venues than the traditional serviced offices operated by its Regus unit.
IWG is considering selling Spaces. A growing list of local operators are now battling WeWork and IWG for market share.
Blackstone’s The Office Group and Germany’s Design Offices are at the front of the chasing pack.
Each of the firms has about 80,000 square metres of flexible office space.
In many major European markets, including London and Paris, smaller, local players collectively account for a majority of the flexible office space market, according to the report.
WeWork’s IPO, and the financial information it discloses in the process could prove useful to its rivals, Mr Sleigh said.