SINGAPORE (Reuters) - Flexible space operator JustCo is set to lease a 16-storey building in Seoul’s Gangnam business district for its largest location, raising its bets on growing demand for co-working space, while eyeing new markets like Japan, Vietnam and India.
Co-working spaces have become popular among startups due to their flexibility of short-term leases in well-decorated spaces in prime locations and keep costs low. Larger companies are also increasingly using co-working firms to manage their offices.
Spread across 140,000 square feet, JustCo Tower, formerly known as FL Tower, will be its fourth centre in South Korea and is set to open in November, it said in a statement on Wednesday.
The building is already 60% pre-leased, mainly by large corporates, JustCo CEO Kong Wan Sing told Reuters in an email, adding that JustCo has an average occupancy rate of 90% across its centres.
The company expects to have more than 2 million square feet across over 50 centres by the end of this year. Currently, it has about 35 centres, including the upcoming Seoul locations, across Singapore, Bangkok, Shanghai, Sydney and other cities.
Companies like JustCo, which was founded in 2011, and SoftBank Group-backed WeWork have become a key source of demand for commercial real estate in major cities. WeWork has 18 locations in Seoul.
JustCo is also in talks to raise fresh funds, Kong said, but declined to give details.
Last year, it entered into a $177 million partnership with Singaporean sovereign wealth fund GIC and Frasers Property Ltd.
Reporting by Aradhana Aravindan; editing by Gopakumar Warrier