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    Coworking with the next generation

    By Chai Hua in Shenzhen | HK EDITION | Updated: 2021-04-25 08:49
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    Editor's note: We're revisiting some startups featured in our Innovation column in the past five years to see how they're performing. Their stories shed light on the subtle evolvement of the innovation ecosystem in the Guangdong-Hong Kong-Macao Greater Bay Area.

    Gazing at his first coworking office built with 36 shipping containers in Zhuhai, Guangdong province, Jia Fan keeps heaping praise on its decoration: "Its color still looks so nice."

    Five years ago, Jia started coworking space company Beeplus Technology. In his last interview with the author in 2019, he focused on his way of managing his three shared-office locations. This time, he said the startup has broken the coworking model.

    The name "Beeplus" can now be seen in more than 30 office projects in a dozen cities on the Chinese mainland.

    In the new economy era, imported models such as shared offices have inspired an array of startups on the mainland, but those who only copy them rarely last.

    The key is to modify these models in the localization process to meet the nation's development demand and carve out a new development path.

    The office-sharing concept began gathering steam in 2015, featuring a desk-based rental model, shared public space, with a fun and casual decoration style and working environment.

    "But I found the description can no longer define what we're doing anymore," Jia said.

    "Some large enterprises with more than 100 employees have approached us for solutions similar to coworking spaces, but they do not need to share them with others."

    The phenomenon inspired Jia to rethink what the new concept or demand should be. Last year, he came up with the idea of the next-generation workspace.

    The new approach inherits core values of the coworking model, such as flexible space, package services for new office preparations and management.

    But the new concept's profit model has changed. Coworking space service providers usually rent an office, remold it and rerent it at a higher price. The risk in the asset-heavy business model is fluctuating the rental costs.

    "We insist on a light-asset model of cooperating with property owners, so we don't have to cover the rent or remolding cost," Jia said. His solution is that property owners pay his company for the space upgrading, as well as management fees in some cases, then rent it out themselves; or they split the rent revenue at a mutually acceptable percentage.

    He said he believes the demand for upgrading existing office properties will be huge soon as China's real-estate enters the stock market.

    Colliers International estimates that this year could see supply peak with 7,800,000 square meters of new office spaces flooding the market — double the amount of the past two years.

    It sees flexible workspace outsourcing becoming an increasingly important part of the commercial real-estate tool kit because COVID-19 has fueled companies' interest in flexible workspace.

    Colliers said asset owners are also eager to include hospitality and lifestyle aspects among their assets, while traditional hospitality operators are eyeing the office sector for opportunities to adapt their offerings to enhance the work environment.

    For companies with their own office properties, Beeplus can provide a customized package service of design, construction, furniture purchase, information and technology services and front-desk personnel.

    Beeplus' next-generation office space model has found favor with emerging unicorn startups, such as self-driving vehicle startup Pony.ai, China's largest ride-hailing platform Didi Chuxing and mainland beverage brand Genki Forest. "We're growing together with them," Jia said.

    The overall ecosystem is also being upgraded. Many State-owned enterprises, government projects and biopharmaceutical companies, which used to have a simple and uniform working environment, have turned to Beeplus for its lifestyle-oriented office designs.

    However, it hasn't been plain sailing all the way in Beeplus' transformation. It had started a large bakery shop in Shenzhen to try projecting a lifestyle image for the brand, but the business ground to a halt last year because of the pandemic.

    "COVID-19 has pushed me and my startup to continue growing and diversifying," Jia said.

    "We've to make tough decisions and these could also make us rethink our strategy and development path. That's crucial to our future."

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