WeWork is known for providing a workspace for startups, freelancers and other smaller entities so the company’s GM for Hong Kong, Australia and Korea Henek Lo might have been a little surprised when banking giant HSBC called up to rent more than 300 hot desks at their new Hong Kong space.
The company’s Hong Kong co-working facility situated in the newly redeveloped Tower 535 commercial complex in Causeway Bay has been open for less than a month and can now count the 85,000 employee-bank among its corporate subscribers.
Lo told the South China Morning Post, that the multinational banking and financial services firm was WeWork’s biggest corporate member in Asia-Pacific so far.
The move is relatively unheard of for Hong Kong businesses, but not for WeWork. Audit, tax and advisory services firm KPMG rents 75 desks at one of WeWork’s Manhattan locations while Bloomberg noted Merck, and UK-based newspaper the Guardian and General Electric-owned Current are a few of the co-working player’s corporate clients.
Earlier this year, WeWork Vice Chairman Michael Gross revealed to the Wall Street Journal that business from large companies was the fastest-growing part of WeWork’s operation.
Wework’s Asian Expansion in Full Swing
The deal is a coup for the co-working company’s fledging Asia-Pacific operations, which secured $430 million for its Asia expansion in a round of funding led by Chinese investors in March.
Since then, WeWork has opened its first shared office space in Asia in Shanghai during July, and followed up by opening in Hong Kong and Seoul at the end of August. A second space is set to open in Shanghai on November 1st at a former opium warehouse on 696 Weihai Lu that has recently been redeveloped.
Additionally, a second Hong Kong location, the Asia Orient Tower on 33 Lockhart Road, is slated to open this year but no date has been set.
HBSC Moving for Culture Benefits, Not Cost Considerations
According to industry experts, HBSC will save HK$7.09 million ($914,207) annually by having its digital and transformation teams at WeWork as opposed to renting a traditional office space. That estimate is based upon a company employing 300 staff in Causeway Bay and needing at least 27,000 square feet of office space. However, the bank says that cost saving was not the primary reason behind the move.
HSBC’s regional head of digital, retail banking and wealth management, Asia-Pacific, Andrew Connell, explained to the SCMP that the move was designed to create the right environment for staff while ensuring they are working in the same location as other like-minded teams, including Hong Kong’s fintechs and other startups.
The firm’s deal with WeWork came on the same day that sources told Bloomberg the bank hired real estate broker CBRE to find 50,000 square feet (4,600 square meters) of space in London’s tech-centric neighborhoods of Old Street and Shoreditch.
Similar to the Hong Kong move, HSBC will be placing its digital teams in a location where a number of startups and fintechs reside, London’s East End.