Hong Kong co-working operator theDesk, Kerry Hotel start profit-sharing venture to beat pandemic-driven slowdown
- theDesk is occupying 6,600 sq ft in Hung Hom hotel
- ‘We have adapted to cater to a new generation of needs,’ hotel’s general manager says
The coronavirus pandemic is forcing a hotel and a co-working space operators to collaborate in a whole new way, one that involves profit sharing instead of the traditional tenant-landlord relationship.
Hong Kong-based co-working company theDesk is now occupying 6,600 sq ft in the Hong Kong hotel group Shangri-La’s Kerry Hotel in the city’s Hung Hom district.
The model “allows us to have tighter collaboration and interest alignment with our partners”, Thomas Hui, theDesk’s chief executive and co-founder, said. “We share the business potential and risks.”
Hotels are among property segments worst-hit by the pandemic. At its peak in the first quarter, about 80 per cent of hotels in Asia-Pacific had to cease operations temporarily, according to property consultancy Colliers International. The segment’s losses have been pegged at US$50 billion by Colliers.
The co-working segment has been badly affected too – demand in Hong Kong is expected to decline as companies are forced to reassess the need for office space amid extended work from home arrangements, Colliers said.
The arrangement between theDesk and Kerry Hotel will compensate the hotel as landlord and minimise risks for the co-working company.