Faaez Samadi
Jul 16, 2018

Killing the cubicle: How co-working spaces are co-existing in Singapore

SECTOR STUDY: Players are fighting to differentiate their workspaces in the Lion City as a pleasant look and decent coffee are just table–or rather hotdesk–stakes now.

WeWork Beach Road in Singapore
WeWork Beach Road in Singapore

If Singapore wasn’t sure what the fuss was about regarding co-working spaces, it certainly knows now. The industry’s growth in the city state over just the past few years has been astronomical, spanning the gamut of large international network co-working space brands to dozens of independent operators offering a space to perch comfortably with a laptop and crack on with whatever you’re doing.

Consider the numbers: to service Singapore’s working age population of 3.7 million people, according to the country’s Ministry of Manpower, online workspace listing Coworking Singapore estimates there are around 90 co-working spaces run by 50 or so operators.

This does not include all the privately leased offices in the Singapore CBD’s numerous shimmering glass towers, or serviced offices. It only relates to co-working spaces, and it’s a significant number for so small a nation.

Several factors play into this explosion, but chief among them are the cost of private office space in Singapore becoming prohibitively high, especially for small businesses that found it hard to commit to expensive long-term leases. In addition, the Singapore government has been determined to grow and support the country’s startup economy, as well as continue to attract foreign companies to open here instead of other Asian locations.

Thus the co-working space market has benefited from near ideal conditions, and by having a proposition that genuinely works for many Singaporean businesses: flexibility and better prices. To illustrate the country’s appeal, international brand WeWork has launched six new spaces since the start of the year alone, two of which are on the same street.

“Singapore is central to an international footprint,” says Daren Goh, regional marketing director for WeWork Southeast Asia. “We see a huge opportunity for growth as many companies seek to enter Asia’s fast-growing and entrepreneurial markets.”

The co-working boom comes at a time when people are reassessing their relationship with work and what it should be. According to a recent study by IWG, one of the biggest players in the workspace market that owns brands such as Regus and Spaces, more than 60% of Singaporean employees work remotely every week, and almost 50% do for half the week.

As such, most brands market themselves as creative, entrepreneurial or inclusive spaces, reflecting the attitudes of younger professionals that now make up the majority of the global workforce. As a strategy, it makes a lot of sense. But what happens when everyone is doing it?

Standing out

Walk into any number of different co-working spaces and the overall sentiment is decidedly similar: well-designed spaces with modern furnishings, enticing snacks and beverages, and perhaps some sort of entertainment space for people to cool off. When one blends into another in such a manner, making your brand noticeable is tricky.

“[The market] has becomes too undifferentiated, with the same value proposition, only different in the interior design style and as such vibes,” says Charlotte Wilkinson, insights director at Labbrand in Singapore. “It’s hard to stand out, so users end up evaluating on price.

“Brands needs to look at the core table stakes of the category – good coffee, comfortable seating, price value – move beyond them and really start adding further value.”

Jori Messer is director of workplace solutions at Paya Lebar Quarter (PLQ), a yet-to-open almost 1 million square feet mixed-use development owned by Lendlease, of which 15% will be dedicated to co-working. He says, as with many industries, the problem is quality, not quantity.

"Truly great spaces are able to offer a holistic product that best serves both business needs and the needs of their employees," he says. "This goes beyond simply reinventing the physical space of the co-working environment itself to rethinking the entire workplace ecosystem."

For IWG, differentiation begins with its different brands. Kelvin Lim, APAC marketing manager, explains that Regus offers “flexible working spaces” that generally focus on large businesses and multinationals looking for a dynamic office environment, while Spaces “provides creative workspaces with a unique entrepreneurial spirit” – by mid-2019 five new Spaces locations will open in Singapore, bringing the total to seven.

Spaces workspace at Robinson Road

IWG’s marketing strategy, which is an multi-platform effort spanning digital, social, a branded app, industry partnerships and more, has at its centre the company’s long history in the workspace sector, something several of its rivals cannot call on.

“Regus has been in the market for over 30 years, hence tenants can be assured that the company will not be plagued by financial whirlwinds – a common problem for most co-working providers.”

Singapore knows this pitfall only too well. Local co-working brand The Working Capitol has wound up its glitzy 55,000 square-foot second property in the heart of the CBD just a year after launching it, having run into financial difficulties.

Selling the experience

Another way differentiate is to try and lose the ‘co-working’ label entirely, which WeWork seems determined to drive home. “We do not consider ourselves as a co-working space and do not see others as competitors,” states Goh brazenly. “We are more than just space; we are a global platform of creators that help people to create a life, not just living.”

Reaching just a bit too far the other way, particularly when other companies offer fundamentally the same service, WeWork’s strategy to reposition itself as a lifestyle space, rather than just an office, taps into the changing culture of workspaces and what they represent.

Goh adds that WeWork has some additional mainstays of its branding strategy – prioritising in-person contact, for example, and offering personal experiences to clients that carry the WeWork brand identity within them.

“We are very selective about mainstream advertising,” he says, “and have focused on activities that are big on facilitating direct conversations with people.”

Wilkinson says this notion of creating meaningful experiences for people in a co-working space, what she calls “intangible networks”, can be a key point of difference for a brand in the sector.

“It’s that ability to tap into some sort of shared resources,” she explains. “But adding commercial value to businesses is more attractive than free wine evenings – access to industry experts, discounted commercial services like design or accounting, these are the things many SMEs need.”

Messer at PLQ says that a key factor to bolstering its experience offering will be the space's focus on health and wellness, with the complex's three office towers being WELL Core & Shell certified, a new global building standard assessing the health and wellness concerns of building occupants - PLQ is the first Singaporean company to be accredited.  

"For PLQ, our positioning for a complete work ecosystem and why it is the future means we have to tailor our messaging to be effective, instead of rely on just advertising," Messer adds. 

A common trait that likely plays into the perceived sameness of the co-working sector is the lack of “niche segment targeting”, as Wilkinson puts it. “Instead of looking at millennials, entrepreneurs and startups as one homogenous group with the same needs, do not be afraid to differentiate via more specific niche offerings that may change your value proposition.”

She points to the now-defunct Woolfworks space in Singapore, which was a female-focused casual space for both work and creative thinking. New business models are also emerging from the likes of Unilever, which has created its own co-working space, LEVEL3, within its offices so Unilever employees can interact directly with entrepreneurs and startups. Similarly, private members’ club 1880 offers a co-working space as an added benefit of its membership.

For such a young sector, the evolution is already under way. Whether so many players manage to stick it out for the long haul seems unlikely, but for now Singapore’s co-working spaces seem happy to duke it out for business, one high-quality coffee station at a time.

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