WeWork, the global flexible office space provider, almost halved the amount of new space it signed up in London this year as competitors ramped up their own property acquisitions.
The US group had a record year for deals in the UK capital in 2017, taking on 1.2m sq ft of new space to make it the city’s largest private occupier of office space. But this year it signed agreements for just 651,446 sq ft of property, according to data from the property agency JLL.
“They had huge, stellar growth in 2017 — that growth is probably not sustainable year on year,” said Elaine Rossall, head of UK offices research at JLL.
Strong demand from the flexible office sector “combined with a shrinking development pipeline” has reduced opportunities to lease suitable buildings, said Rossall.
She added that some of WeWork’s new sites were also still under construction, meaning “they have a number of centers due to open in 2019 and 2020 — they are looking much further out”.
Financial results for WeWork’s main European entity in October showed the company had taken on £3bn of UK leasing commitments spanning the next two decades.
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