WeWork Rival RocketSpace to Leave U.K. in Co-Working Blow
(Bloomberg) -- RocketSpace Inc., a San Francisco-based WeWork rival, is pulling out of its U.K. shared office business and will shut down the subsidiary by April in another blow to London’s co-working scene.
Chief Executive Officer Duncan Logan told U.K. employees last month that they’d be out of a job after Dec. 20, according to a person familiar with the plans, who asked not to be identified because the information is private. The company will instead refocus on funding services for startups, according to emails seen by Bloomberg News.
The 1,500-seat office in the North London borough of Islington has already removed marketing materials from its website and no longer lets visitors request tours. RocketSpace has said it plans to close RocketSpace U.K. Ltd. and RocketSpace Angel Ltd. by April, according to regulatory filings. The latter had debts of about 9 million pounds ($11.6 million) due this year, which the company has sufficient money to repay, according to the November filing.
Representatives for the company couldn’t be immediately reached for comment, as phone lines had been disconnected or diverted to voicemails. Logan didn’t immediately respond when contacted on LinkedIn.
The decision follows WeWork’s sweeping review of its expansion plans for London following its bailout by SoftBank Group Corp. The embattled office company is reassessing whether to proceed with about 28 potential office deals in its second-largest market, people with knowledge of the matter had said. The cash-strapped company has also warned European staff -- most of whom are based in London -- that job cuts are looming, Bloomberg reported last month.
Read more about WeWork’s review here.
RocketSpace’s expansion into Britain in 2017 was the company’s first market outside the U.S, helped by a partnership with Royal Bank of Scotland Group Plc. RBS has a long-term lease on the Regents House building, which spans about 60,000 square feet (5,575 square meters), according to a person with knowledge of the contract. The bank will likely seek a new tenant to sublet the space though no firm decisions have yet been taken, the person said.
“As a bank, we’re proud of our partnership with RocketSpace and of what has been achieved by so many of the innovative tech startups based at Regents House over the last two years,” said RBS Group Chief Administrative Officer Simon McNamara. "We wish them and their members every success with their future ventures and look forward to working with many of them as they grow their businesses.”
According to archived versions of RocketSpace’s website, facilities available included private offices, “hot desks” for individuals, an event space with 350 seats, kitchens and showers.
(Updates with RBS comment in penultimate paragraph)
--With assistance from Jack Sidders.
To contact the reporter on this story: Nate Lanxon in London at nlanxon@bloomberg.net
To contact the editors responsible for this story: Giles Turner at gturner35@bloomberg.net, Amy Thomson, Edwin Chan
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