WeWork emerges as a major force in Tokyo’s sizzling office market
Shared workspace provider WeWork is shaping up as a powerful force in Tokyo’s office real estate market, which is basking in its biggest boom since the bubble years of the early 1990s.
The fast-growing American startup, noted for its sleek, stylish workspaces, has been expanding rapidly in Tokyo’s prime business districts since entering the market in February, as the office vacancy rate in the capital hits its lowest level in decades.
WeWork’s aggressive strategy in Japan, which the company views as a growth market, is adding fuel to Tokyo’s already hot property market.
In just eight years since its founding in 2010, WeWork has expanded into a global presence, becoming the largest supplier of office space in New York and London.
The New York-headquartered company is not just a shared workspace. It also encourages occupants to network with each other to build business relationships — a model that has been the driving force behind its breakneck expansion.
Since its foray into Japan, WeWork has opened 11 locations nationwide in just 10 months, and plans to increase this number to around 30 by the end of 2019.
WeWork has triggered a seismic shift in central Tokyo’s office market. A midsize building in Minato Ward, where WeWork opened another location earlier this month, saw its price shoot up more than 50% in six months. Goldman Sachs, which purchased the property, is said to have done so due to the presence of WeWork.
This property was originally sold by clothing company Sanyo Shokai to GreenOak Real Estate, a U.S. investment management company, for slightly over 6 billion yen ($53 million) in April. Goldman later snapped it up through an affiliated real estate fund for over 10 billion yen in early December.
WeWork outfitted its latest branch with desks and chairs in various sizes, and provides coffee with unlimited refills and craft beer on tap.