Hong Kong’s shared office market grew even more crowded this past week, with local co-working provider R One Space traveling to Kowloon East on Wednesday to open the company’s second site in the city. The new centre follows on the heels of the opening of R One’s first facility in the commercial hub of Causeway Bay in October.
The new location for Royal One Co-Working Space, which uses the R One moniker for snappier branding, is the latest venture by local entrepreneur Mark Chan, who also serves as chairman of Hong Kong-listed Shunten International, which produces traditional Chinese medicine and health tonics under the Royal Medic brand.
Chan’s co-working startup plans a series of new locations in the coming months, with its latest facility located in Kowloon East’s Kwun Tong area, which is fast becoming a haven for multinationals and other corporate occupiers fleeing rising rents in Central district.
3 Floors, 26,000 Square Feet of Space
R One Space’s Kwun Tong outpost is located in One Pacific Centre, an office tower completed by local developer Hong Kong Pacific Investments Limited in 2012, and is a two-minute-walk from the Kwun Tong Station MTR station.
The project covers 26,000 square feet (2,415 square metres) across three floors of space — from the 20th to 22nd floors of the 28-storey building — and provides up to 510 desks with 92 separate offices. The size and design of the office can be divided according to the requirements of tenants, who can lease the offices and desks on a monthly basis, over terms as short as one month.
Hot desks in the office are available for HK$3,000 ($384) per month, and private rooms are available for as little as HK$4,000, although windows are optional. R One Space said it has invested HK$20 million in the Kwun Tong office, which is already 30 percent occupied.
Chan said at a ceremony marking the opening of the office that the centre’s occupancy rate is expected to climb to 50 percent within three months. The R One’s first site in Causeway Bay is said to already be at 50 percent capacity, less than two months after it was launched.
Aiming for Startups in Kwun Tong
According to Chan, Kwun Tong, which offers rental rates at about one-third the cost of those in Central district, would be an ideal office location for startups, with flexible office plans offering more options for those companies looking for accommodation in the area. “The young entrepreneurs need more space for their business,” Chan said. “East Kowloon, as the second business centre in the city, is expected to see more demand in the future.”
According to Jonathan Wright, director of flexible workspace services for Colliers International in Asia, Kwun Tong offers an ideal entry market for flexible space providers, given its lower leasing rates and rising popularity with tenants. “Kwun Tong is a fast-emerging district that is building a critical mass of occupiers, and with that comes a need for amenities,” he said. “There will be growth here for sure.”
R One Space’s new site in Kwun Tong is around 10 minutes’ walk from WeWork’s first location in Kowloon, which opened in the middle of October at Sun Hung Kai Properties’ Two Harbour Square on Wai Yip Street.
Shared Office Options Multiply in Hong Kong
R One Space enters the Hong Kong flexible office market as a growing number of local players, mainland companies and international co-working operators compete for space to launch new hubs in the city.
WeWork’s Greater China director, Alan Ai, said during the opening of the firm’s Kwun Tong site in October that the company was aiming to triple the number of its sites in Hong Kong over the next two years. Mainland flexible space company Kr Space has also leased seven floors in Chinachem Group’s office building One Hennessy in Hong Kong’s Wanchai district as its first site. That site is expected to open in the second quarter of next year.
Wright said Hong Kong’s co-working sector had not yet reached its limit and would “continue to grow, diversify and evolve.”
“While we see significant M&A activity next year and a number of operators from US and UK markets entering, there will always be room for local operators,” Wright said. “What will be interesting to observe will be how deeper partnerships are structured with landlords and funds,” he added.
Chan said that R One Space would open another two sites in Tin Hau, in Hong Kong island’s eastern area and in Kowloon’s Tsim Sha Tsui district in March and April next year, respectively.