Frustrated by the lowly valuation the market gave to International Workplace Group (IWG) — better known as Regus — Mark Dixon toyed with the idea of selling out to private equity last year.
That frustration may have given way to alarm. Shares in the serviced offices provider are down 60% to 174.5p this year as investors fear that the near-total shutdown of the economy will destroy IWG’s rental income.
The shockwaves unleashed by efforts to contain the coronavirus have thrown the flaws of IWG’s model into sharp relief. IWG and its glitzier rival WeWork let much of their space over short-term periods, but are themselves locked into much longer leases — about 4½ years on average in IWG’s case. And many of their tenants are