Is the office still as attractive a place to work as it used to be?
Christophe Burckart - Yes, and I'm even surprised by its resilienceIt's a place to socialise. Even if the company employees were not very present in our spaces, their occupancy rate is not very high. never below 70 % since March 2020. Many companies have continued to renew their contracts to ensure that they can return to their offices. As a result, we are now back to where we were before the pandemic.
Has the pandemic increased demand for more flexible property solutions?
C. B. - Since the end of the confinements and the acceleration of the vaccination campaigns, our sales have risen by 60 %, and I see two explanations for this. Firstly, with the uncertainties linked to the pandemic, companies have felt the effects of the crisis. the need for agility in property management with workspaces that can adapt to their changing needs. Secondly, with the introduction of teleworking policies, they are wondering how office real estate can support their implementation. Some companies refuse to accept the "either work or home" approach. That's why we're pushing ahead with our subscription offer, which gives access not just to a single business centre, but to all our 3,500 centres worldwide.
However, this subscription offer is not new to IWG.
C. B. - In fact, it already existed, but it is exploding. In the almost thirty years of our existence, we have attracted 3.4 million users to this offering. Now, in just 18 months, we have grown to 5.2 million. In Japan, for example, NTT has subscribed its 300,000 employeesDell and Cisco have followed suit in Europe, and this offer is also attracting smaller customers, particularly in France. For an average of just a few dozen euros per month per employee, and invoiced according to the time spent in our spaces, this formula is perfectly suited to new working habits. It adds value to teleworking. Employees can choose to work at home, in a centre close to their home, or find a workspace when they're on the move. This reinforces our commitment toreach 1,000 centres in Francecompared with 130 sites in 76 towns and cities today.
You had already announced this objective before the pandemic. When do you expect to achieve it?
C. B. - I would say around 2030. This target, announced in 2019, had a time horizon of five to seven years. Now it's up to us, we give ourselves another five to seven years. Growth opportunities remain very strong, as our model only represents 2% of the market today. At present, we have resumed the opening pace of the pre-covid period, with one new centre per month. To find out more, our franchise development is a strong leverbut has been delayed a little in the current climate. Investors and their banks are waiting for the situation to stabilise. But a number of significant deals are now in the signature phase. Announcements are expected shortly, probably in the early months of 2022. By the end of the year, therefore, I think that between openings and signings, we will have added around twenty franchised sites to our offering, in addition to our organic growth, which should amount to around fifteen centres.
How will the development of new working habits support your growth?
C. B. - This development offers two types of opportunity. Firstly, the fact that 90% of companies, particularly large users, now have unoccupied square metres. They wish to put them back on the market, hence the possibility of agreements with tenants or owners to operate sites on these unused square metres. As soon as they can be monetised on advantageous termsMany are showing an interest. We have already demonstrated our ability to do this in the past, and discussions are now underway on a regular basis.
When you ask companies where their needs are, they are more and more in Pau or Rodez than in the centre of the big cities.
As for the second type of opportunity, what is it?
C. B. - Current developments call on us to strengthen our national network. When you ask companies where their needs are, they are increasingly in Pau or Rodez rather than in the centre of major cities. Today, when some major accounts ask you to house their teams, it's rarely in Lyon or Lille, but rather in towns where they don't want to have assets, but still need a presence. And that means solutions.
However, the Paris region is also one of your priorities.
C. B. - That much is clear. Ile-de-France, it's not just La Défense or the Paris Golden Triangle. The idea is to expand beyond these areas, such as Versailles, Poissy and Alfortville, where we are already present. But there are many others where we are not yet. For example, the Stop&Work provides an alternative to working from home by offering third-party workplaces in residential areas in the outer suburbs of major conurbations. In the Paris region, we have such centres in Fontainebleau, Bourg-La-Reine and Maisons-Laffitte. But we have also opened a Stop&Work in a fast-growing business district, the Paris-Saclay plateauwhere we have created a 6,000 m2 ecosystem dedicated to innovation. On the ground floor, there is an events centre open to residents and all local players. On the first floor, there is an incubator for start-ups, which will benefit from a number of tools, including virtual reality laboratories and media labs. There is also an incubator that will benefit from acceleration programmes with partners such as French Tech. Finally, Stop&Work Paris-Saclay also includes a business hotel and a more traditional business centre, where the offices of more established companies are housed.
What is your strategy for France's major cities?
C. B. - In these main cities, we see opportunities for expand the presence of our various brands. If I take Spaces, which we started rolling out in 2017 in ParisIt's now in Bordeaux and has recently opened in Nice. We will be opening a Spaces in Marseille in February, another in Lille a little later in the year and then in Lyon. And there are still other cities where we don't have a presence, such as Toulouse, Nantes and Rennes. The same goes for HQ, our entry-level brand, aimed at businesses on a tighter budget. We open HQ Paris Blanche on 5 January(Editor's note: the sixth HQ address in the Paris region, the HQ covers 873 m2 and six floors, and offers 141 workstations, virtual offices, meeting rooms and coworking spaces). But the HQ brand isn't everywhere yet. The same goes for the very top end of the market, with our Signature brand. In Paris, we have two prestigious addresses, on Place Vendôme and rue Saint Honoré. In Bordeaux, we have set up on Place des Grands Hommes and Cours de la liberté in Lyon. But there are still no Signature stores in Lille or Nice, for example.
By setting up a business centre in a major entertainment venue such as the Accor Arena, we are part of this broader services policy.
You're also developing your offer through innovative concepts, such as the future Spaces at the Accor Arena in Paris.
C. B. - Our aim is to move towards new concepts such as the one proposed at the Accor Arena from next February. With the arrival of the Spaces brand in our group's offering, we had already moved into more community-based services such as wellbeing and sport. By installing a business centre in a major entertainment venue such as the Accor Arena, we are part of this broader services policy. We have agreed with the management of the venue to find a creative way of using and monetising their spaces, which are mostly not used outside of events. For our part, as part of a wider ecosystem of services, our customers will be able to take advantage of a concierge service and catering facilities. The dressing rooms will be refurbished and converted into offices privatised between events. The Arena's meeting and training rooms will also become shared coworking spaces, and the Accor Arena's VIP lounges will become Business Clubs for visiting customers.
Is it easy to get into a business centre that also hosts numerous events throughout the year?
C. B. - The important thing is to be transparent about how things work. We undertake to make these spaces available to the Accor Arena on the morning of the events. However, as the vast majority of these events take place at weekends, we have to be transparent about the way we operate, the risks of telescoping are limited. And if an event takes place during the week, we can draw on our extensive network in Paris to suggest that our customers go and work in nearby centres, such as the Gare de Lyon. The schedule, known in advance, will be communicated on a regular basis, so they will be able to adapt quite easily.
As part of these new concepts, are you thinking about other places where you could integrate workspaces?
C. B. - There's a concept we tested a few years ago in France that we want to try out again because it works in other countries. motorway service areas. In the years to come, a large number of service hubs linked to electric cars are likely to be created. Hence the importance of offering workplaces while travellers recharge their carsThis can take 30-45 minutes with the super charge, and even longer if other people are already waiting. You can't just keep people occupied with a coffee. That's why we want to test things around this approach. We're working on several development plans.
