Two major international co-working companies, WeWork and International Workplace Group (IWG), are expanding their presence in Canada through partnership agreements.
WeWork has launched its Co-working Partner Network, an affiliate program of third-party workspaces, with a partnership with Vast Coworking Group.
IWG has added three independent operators in Ontario and Alberta to its network so far in 2024.
West Palm Beach, Fla.-based Vast was launched by United Franchise Group founder and chief executive officer Ray Titus and is the world’s largest privately owned franchisor of co-working spaces.
The partnership between the two companies will give WeWork Workplace members access to more than 75 locations in more than 50 markets across the United States and Canada in addition to WeWork’s existing portfolio.
WeWork has 16 Canadian locations in Toronto, Vancouver, Montreal and Calgary. Vast has 20 locations in the Greater Toronto Area (GTA), Ottawa, Edmonton, Hamilton and Vancouver.
Eight Vast locations have opted into the partnership with WeWork: five in the GTA; one in Edmonton; one in Hamilton; and one in Vancouver.
Yardi Systems and WeWork’s restructuring
Vast president Jason Anderson first touched base with WeWork in 2022 after realizing there wasn’t a lot of overlap among their locations, as WeWork is more focused on city centres while Vast is more suburbs-oriented.
The conversations picked up again after WeWork filed for bankruptcy protection and went through a major restructuring. Yardi Systems acquired a 60 per cent stake in the company this spring and its Yardi Kube co-working software and workspace management program is powering WeWork’s Co-working Partner Network.
Vast is also a big user of Yardi Kube, according to Anderson, which adds to the synergy of the partnership.
“During our restructuring, we successfully negotiated with many landlords across Canada, maintaining locations within great buildings in prime areas while establishing lease terms that benefit both WeWork and our landlord partners going forward,” a WeWork spokesperson wrote in an email to RENX.
“Currently, our focus is on ensuring our strengthened portfolio is positioned for success. We will continue to pursue opportunities, such as the Co-working Partner Network, to create sustainable and responsible growth based on our members’ desires and needs.”
Vast’s franchisees will get access to all of WeWork’s clients, which Anderson said should generate more revenue for the firm.
“I think it’s good for the industry,” Anderson said of the partnership with WeWork. “As a privately owned, profitable company, our members will get additional locations and WeWork hopefully gets to keep some of their enterprise clients happy by adding suburban locations.”
Vast’s three platforms
Vast has three platforms for clients: Intelligent Office, Office Evolution and Venture X.
Intelligent Office locations average around 6,000 square feet with 10 to 15 private offices and three employees. It doesn’t offer flexible office space or co-working.
“The second business model in Intelligent Office is Intelligent Assistant,” Anderson explained. “This is having a local assistant that can help do inbound and outbound calling, form intake, submissions, notarizing your documents, file storage and file shredding.”
Office Evolution locations average around 12,000 square feet, comprised almost entirely of private office space, and one employee. Some locations have close to 60 private offices.
Venture X locations average around 24,000 square feet and have larger enterprise offices that can accommodate more people. They have a cafe and a co-working area that can also serve as an event space, a lunch area and a meeting site.
“There are some differences in revenue per square foot,” Anderson said of the three platforms. “So when we’re looking at different models and demographics and cities and buildings, we look at what revenue model makes the most sense, the availability, the demographic, who the competitors are in the space, and the best location.”
There are 12 Intelligent Office and eight Venture X locations in Canada. There are seven Intelligent Office locations and one Venture X location involved with the WeWork partnership.
IWG is also doing partnerships
Meanwhile, IWG is also continuing to expand its global network of flexible workspaces through partnership agreements.
Three Canadian independent co-working operations have signed agreements to transition to the company’s Regus brand this year:
- 640 Professional Building at 640 3rd St. SE in Medicine Hat, Alta., which is more than 16,000 square feet and offers co-working space, 60 private and semi-private offices, two meeting rooms, kitchen space and an outdoor patio;
- the 6,000-square-foot LOCO SPACE at 15 Wellesley St. W. in Toronto, which has private offices, meeting rooms and co-working spaces;
- and Seaway Coworking at 310 Bagot St. in Kingston, Ont., which will officially transition to Regus on Nov. 1. It has 16,425 square feet of flexible workspace with 234 work stations, three meeting rooms, a kitchen, a lounge area and event space.
The partnership agreements allow existing and new clients access to more than 50 flexible workspace locations across the GTA, 150 across Canada and more than 4,000 globally in 120 countries.
IWG added 867 new locations in 2023 and posted its highest-ever revenue in its 35-year history.