SINGAPORE (EDGEPROP) - Companies and workers in Singapore are bracing themselves for several more weeks of disruptive work arrangements, even as the epicentre of the pandemic has shifted to Europe and the United States. Speaking in Parliament on March 25, Health Minister Gan Kim Yong says Singapore should expect more cases as overseas Singaporeans return home in the coming days.
Co-working operators here are bracing themselves for tougher times ahead too. As part of efforts to stem community transmissions while ensuring economic continuity, the buzzwords of the day are “Business Contingency Plans” (BCP) and “Work from Home” (WFH) arrangements. But this also means a decline in demand for some flexible workspaces.
Many co-working operators have already implemented government guidelines such as temperature screening, the filling up of declaration forms and safe distancing in their co-working locations. JustCo, the largest homegrown co-working operator, says it is working with their building managers to implement these steps. The company manages 42 co-working centres in eight cities in the Asia-Pacific region, including 19 co-working centres in Singapore.
A picture taken in 2019 of JustCo's coworking location in Marina Square. The company has implemented government guidelines such as temperature screening, the filling up of declaration forms and safe distancing in their co-working locations (Picture: Samuel Isaac Chua/The Edge Singapore)
According to Brandon Chia, vice-president and head of Singapore and Indonesia at JustCo, “We have also increased the cleaning frequency of our centres, and our cleaners are also instructed to be more detailed and thorough in their daily cleaning routine — including common areas such as the hot-desking space, collaboration corners, breakout area, and games areas.”
Other operators have taken to removing half the seats and desks in some common work areas to comply with government guidelines on safe distancing between people. Dominique Vincent, CEO of Found8, says this has been done in their hot desk areas and meeting rooms in their five locations island-wide.
Country-wide shutdowns in China and Malaysia have also impacted those operators with a regional footprint. Matthew Chisholm, COO of Arcc Spaces, says that some team members from their Beijing office were stuck in their hometown in Wuhan — where the novel coronavirus is said to have originated — when the city went into lockdown. The operator also had to close its four co-working spaces in Kuala Lumpur when the Malaysian government announced its movement control order (MCO) on March 18 which will now end only on April 14 after an extension.
According to Chisholm, its co-working centres in Beijing and Shanghai saw office usage drop to about 10% in the past two weeks, but attendance in its Singapore workspaces only fell by 10% over the same period.
An artist impression of Arcc Spaces coworking location at High Street. The company says it has only seen a 10% fall in attendance among its tenants in Singapore over the past two weeks, compared to a 90% fall in attendance in its centres in Beijing and Shanghai (Picture: Arcc Spaces)
“[In Singapore] the response from our tenants has been reflective of the general population and most people are trying to go about as business as usual. We don’t see a whole lot of attrition or fall off on people coming to work,” he says.
However, this is because the company targets SMEs with less than 100 people, and provides security and exclusive access into each floor and office space. The co-working operator has two centres in Singapore — at Suntec Tower 2 and a building at 75 High Street. It has 18 other office locations in five other cities in Asia.
Arcc Spaces has also come up with short-term initiatives to help companies affected by work disruptions. Three weeks ago, it rolled out The Arcc Sanctuary Plan, which has been designed to help companies whose office spaces have been shut down temporarily but still need a business space for operations to continue running.
The Arcc Sanctuary Plan enables some companies to reserve a temporary workspace in their Singapore or Hong Kong locations, relocating staff within one business day when a disruptive event occurs. Flexible contractual terms are also available for a part of the cost of a standard office lease, providing greater flexibility for a company to resume their operations as soon as possible.
Arcc Spaces COO Matthew Chisholm says they are offering a ‘Sanctuary Plan’ for business affected by work disruptions (Picture: Arcc Spaces)
According to Arcc Spaces, the initiative has already attracted more than 12 enquiries from different companies that have between 20 to 100 people.
Other short-term initiatives the company has rolled out include virtual office packages and in selected cases, it has offered to decrease monthly rentals for some tenants, but also adding a couple of months to the end of the lease term.
Read more: Arcc Spaces’ homecoming
Some established co-working operators here say that they are not too exposed to cash flow risk for now as most of their floor space is set up for private offices and larger team rooms. At Found8, the company says that team rooms and private offices take up about 85% of the floor space while hot desks make up the remaining space. The co-working operator has centres in Amoy Street, Anson Road, Cuppage Road, North Bridge Road and Prinsep Street.
According to Dominique Vincent, CEO of Found8, the company recorded an increase in demand for its private spaces and hot desk spaces from the start of February to early March. “This is because many of our members tend to travel around for work, but because of the current situation travel has significantly reduced. As a result, they are still coming to work in their office space with us,” he says.
The uncertain economic situation is forcing some of the members in Found8 to pause their memberships (Picture: Found8)
However, the situation developed quickly and things have changed significantly over the past two weeks. “Now we are seeing less people because quite a few have either decided to work from home, while others have been called back home by their parent companies. We also have a few who are suffering from the [economic] situation, which is forcing them to pause their memberships,” says Vincent.
On the other hand, larger operators like JustCo have been scaling up their operations in recent years to attract enterprise or corporate clients. According to Brandon Chia, JustCo’s head of Singapore and Indonesia, “enquiries have remained healthy and this can be seen from the encouraging take up rate of our upcoming new centre at OCBC Centre East.”
Chia adds, “Amid the ongoing Covid-19 developments, companies and members have viewed JustCo’s fully furnished and ready-to-move-in offices ideal for their business continuity plans, where employees can still function productively.” However, he says that its weekly networking and community events have either been postponed or suspended to minimise the risk of transmission.
JustCo is not alone in this area. The Work Project (TWP) has also announced that they are postponing community events and the operator has stopped selling its day passes as well as stopped accepting external bookings of its meeting rooms from non-members.
Read more: JustCo to open new co-working centre at The Centrepoint in 3Q2020
Junny Lee of The Work Project says that they have suspended day passes and external bookings for meeting rooms in its spaces from non-members (Picture: Albert Chua/The Edge Singapore)
TWP has five centres in Singapore in OUE Downtown, Capital Tower, Asia Square, Great World City, and in Bugis. It also has a centre in Causeway Bay in Hong Kong. The operator says that its centres are close to fully occupied and that it does not expect to be exposed to much risk at this time.
Junny Lee, CEO of TWP, says that their clients depend on them to keep centres open and this has played a critical role for some clients and their business. The company also has a taskforce that updates its SOP in line with government guidelines, as well as scenario training for situations such as having an infected case in their centre.
However, he reckons that the next six months are likely to be an uncertain time for the co-working industry in the region. “Smaller companies that only operate out of flexible space might have to downsize as a response to the economic uncertainty. Meanwhile, corporations with core office locations will be able to organise their BCP between multiple locations,” he says.
Smaller companies that only operate out of flexible space might have to downsize as a response to the economic uncertainty, says Junny Lee, CEO of The Work Project (Picture: Albert Chua/The Edge Singapore)
TWP says it is still working towards the opening of a new centre in CapitaGreen this June, and the space had been almost fully pre-committed ahead of the opening. They are also still working to open a new location in the upcoming CapitaSpring next year. Separately, Arcc Spaces also says they are working towards the opening of their 19,000 sq ft flagship space at One Marina Boulevard in April this year but will continue to monitor the situation in Singapore.
However, other operators like Found8 say they have decided to put their expansion plans on hold until after the pandemic subsides. The co-working operator says it had planned to roll out a second centre in Kuala Lumpur, as well as new locations in Ho Chi Minh, Bangkok, Jakarta, Manila and Sydney.
Says Vincent, “We have reconsidered our expansion plans and at this stage we are putting all this on hold. We need to rethink if it’s the right thing to do, and right now we are regrouping and working on our centres in Singapore and seeing how we can continue to encourage the innovation ecosystem in our spaces here.”
The pandemic and widespread adoption of BCP measures in Singapore will likely become a trigger for some companies to reconsider flexible workspaces, says Vincent.
“I won’t be surprised if we see some corporations who will be eager to discover what co-working can do for them. BCP and split team arrangements are likely to remain in place for a while, and while working from home is nice for the first two to three weeks, at some point, people need to socialise and thrive on ideas. Nothing beats social interaction,” he says.
Dominique Vincent, CEO of Found8, says that the widespread WFH in Singapore could serve as a trigger for more companies to consider flexible workspace in the future (Picture: Found8)
However, Vincent does not expect a recovery to occur within the next six months. Instead, he is gearing up for a tougher time that could last for about nine months at best.
Lee of TWP also expects the uncertainty to continue for at least the next six months. But he is optimistic towards the long-term outlook for the office market in Singapore post-Covid-19. “I’m very confident in the long-term outlook for the office market in Singapore. Generally, trust in the government is strong and in TWP trust between team members is also holding strong.”
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