US flexible office provider Knotel, which has overtaken WeWork in New York by number of locations and square feet, has reported signing six new lease agreements in London since November 2018.
The deals include properties in Baker Street, Hatton Garden and Newman Street and cover almost 60,000 ft2 (5,575 m2).
'Our continuing strong and rapid growth shows there is still a major demand for flexible office space, particularly from businesses looking to expand without dauntingly long lease agreements,' said Amol Sarva, co-founder and CEO of Knotel.
'Our business model has seen us grow faster than anyone else in the industry and London remains a strategically important region for us. We have big plans for 2019, not only in the UK, but across Europe and beyond,' Sarva added.
The new London office agreements include a 7,500 ft2 space at 27 Baker Street, signed in January and 20,200 ft2 across three floors at 87-91 Newman Street. Knotel has also taken 13,400 ft2 at 8 Kean Street, 5,400 ft2 at 1-2 Berners Street and 11,500 ft2 of the Johnson Building in Hatton Garden.
Agressive growth
Before Christmas, Knotel told PropertyEU about its 'aggressive' expansion plans across UK and European markets, after taking over AhoyBerlin!, a German flex space specialist, inking a number of London deals, and acquiring blockchain business 42Floors. In January it moved into the French market via the strategic acquisition of a majority stake in Deskeo.
‘The reason we have been growing so fast on the supply side is that we are seeing tremendous demand from all types of companies: from small, high-growth venture capital-backed firms to those in the Fortune 100, and that has been our vision from the start,' the firm's global head of real estate and business development Eugene Lee told PropertyEU. 'As we have grown the business, we have seen the size of company coming to Knotel increase very rapidly and look for space for an increasing duration of time.’
Lee said that the company was not like a typical landlord, which might operate one location in each of 50 cities, but that cannot help a company once its building is full. But being able to offer bespoke office space in many different locations in one city requires a large number of options, placing pressure on Knotel to expand rapidly. He remarked in December: ‘We require a good amount of supply in order to have the product for our customers. It would not surprise me if we had between 50 and 100 locations in London (by the end of 2019).'
The new deals bring Knotel’s total footprint to more than 2.5 million ft2 globally and its London sites into double figures.
Since its launch in 2016, Knotel has raised $160 mln (€140 mln) in funding. Investors include commercial brokerage Newmark Knight Frank, Bloomberg Beta, and Norwest.
