naked Hub, a Shanghai-based network of co-working spaces, announced today an undisclosed amount for the first tranche in their Series B round. This round of funding comes from a fund managed by Gaw Capital Partners, an investment company focusing on real estate markets.
According the the company, naked Hub will accelerate its regional expansion and enhance its property resources via Gaw Capital Partners. The co-working brand aims to add 24-30 new locations (approximately 150,000 square meters and 30,000 members) across mainland China, Hong Kong, Singapore, and other key Southeast Asian cities.
Backed by lifestyle and hospitality company naked Group, naked Hub now operates 8 hubs in prime Shanghai neighborhoods in Xintiandi, Xuhui, Nanjing Lu (a popular shopping area), Century Avenue (a financial center), Hongqiao (a transportation hub), Jingan, and Gubei.
“Like a tech company, naked Hub moves fast and innovates in an agile way. I believe we already have the strongest in-house user experience and technology team of any co-working operator in Asia and our innovations in online-and-offline service experience for our members has only just begun,” said Dominic Penaloza, CIO of naked Group.
The co-working space market has boomed in recent years, growing 71% annually from 2007 to 2015. It is projected to grow 68% annually from 2016 to 2018. China’s co-working market has also witnessed exponential growth in the wake of global explosion. Companies with different backgrounds such as real estate (UR Work, Soho 3Q), hotel development (naked Hub), media (KrSpace), have all flocked into the sector hoping to ride this wave. Foreign co-working space giants like WeWork and Aussie company Fish Burners have also dipped their toes in the rising market.
According to Wall Street Journal, there were 3,200 co-working space companies in 2014, compared to 400 in 2008. But as the market continues to saturate, companies will have to offer more than just a polished, beautiful space.