New Work Offices Zrt.
Expansive and creative
The story of New Work Offices Zrt. is the story of Hubert Abt. He grew up in a little Swabian village on his parents’ farm, where he learned at an early age that a working year is made up of 365 days. “Cows don’t go on holidays and the farmer has duties that are not perceived as burdens, even if sometimes it’s really hard when you lose your crops due to hail or drought,” Abt says. “You learn to be grateful and humble, and you also learn to work even harder.”
Perseverance and tenacity
At the age of 20 he turned his back on the family business and for four years worked as a professional soldier, namely a training officer, educating not only the rookies but also himself. Triathlon in the summer, biathlon in the winter and about 40 marathons, including several runs of the New York Marathon – these efforts gave him the perseverance and tenacity he later demonstrated during his career.
After a short trip into the field of insurance, he opened his own real estate agency at the same time that he was finishing college. Driven by curiosity, he simultaneously introduced himself to the world of finance besides the real estate business, and he studied part-time Finance and Real Estate at the European Business School.
As well as the mediation of real estate transactions, Abt worked with project developments, taking him to Prague in 1992. “These were exciting times,” he remembers. “Eastern Europe had its own charm and there was a lot to do. Absolutely how I like it. When the Deutsche Bank called us in 1996 and asked us to manage a large real estate portfolio in Poland, I was in.”
More diversified, so more crisis-proof
Following the global economic crisis of 2008 Abt took over some properties from the portfolio and he stayed in Warsaw. But he was already considering how he could diversify the real estate services better to make them more crisis-proof.
These considerations led him to Budapest, where in 2012 he was offered to rent an empty office space in 2012. Abt thus founded New Work Offices Zrt., which concentrates exclusively on the flex offices segment. Five years later the company was operating from eight locations in Budapest and Budaörs, with a total area of 20,000 square metres. The New Work Center at Westend in Budapest occupies 3000 square metres alone, which is currently mainly rented by an educational institution.
Rent in large, sublet in small
In particular, small- and medium-size enterprises have discovered the benefits of flex office more and more in the past few years: small office units of a size determined based on the number and job profile of employees and not square metres, with shorter renting periods and favourable rents. The coronavirus pandemic has accelerated the trend of more flexibility in choosing office spaces and contract periods. Flex offices had a market share of some 3.5% before the pandemic but the industry agrees that this will increase up to about 20% in the coming two years.
“The pandemic led to a paradigm shift in the real estate industry faster than expected,” Abt sums up, and he is happy that he recognised the potential in this business model quite early.
No classical office atmosphere
The New Work Center is completely absent of the classical and sometimes sterile office atmosphere. The lobbies are inviting, arranged in an artistic ambiance. When you enter the Budapest New Work Center in District VI’s Anker köz, you are greeted by a fine coffee aroma and playful figures on the walls in different colours. The reception is small, so it does not give the tenants and guests the impression of a fortress wall.
Basically, the tenants need bring only their own laptops to the workstations. The printers, large-scale photocopy machines, conferencing and communication technology are all included in the rent.
New Work Offices has been expanding in further Central European countries since 2017, and by today they are present in Poland with locations in Warsaw, Lodz, Cracow and Danzig, and in the Czech capital, Prague, as well. The company operates 16 offices in these three countries with a total useful area of more than 43,000 square metres.
It looks like expansion is coming back
The coronavirus crisis caused but a short pause. New Work Offices is opening two new centres this year in Danzig and Lodz, Poland, each 5000 square metres. “We have received many takeover requests due to the crisis. Next year we will probably be opening about 10 more locations,” Abt estimates.
“Digital business models such as Airbnb, Uber or Spotify apps are part of our everyday lives. Why don’t we develop an app for using offices?” the entrepreneur thought about a new business model. New Work Offices and its subsidiary workcloud24 are entering this business before the end of the year. Besides the existing markets they are looking to enter Germany, Austria, Switzerland and England with products similar to New Work Centers.
Workcloud24 developed a digital Office Pass that allows clients to use different office spaces without having to sign a long-term rental agreement. The company is profiting from the circumstance that combining home office with rotating workstations is becoming the new normal, and the real estate industry must find a solution for that.
“The deed counts, not the plan!”
“Think global, act local – the deed counts, not the plan! We have always been faster and more active in terms of realising projects than large companies. You have to understand people and their thinking and act on it. We are working in five different languages and with five different currencies and with at least that many local regulations. So this is not really that easy to copy,” Abt answers in a relaxed way when asked if he is worried about potential copycats of his business model.
Furthermore, he has solid financing by international investors. “We do not have any liabilities towards banks,” he emphasises. In order to finance growth, the company is currently making a capital increase by issuing new shares to the value of EUR 15 million.
Despite all his success, Abt manages to stay modest. He doesn’t even own a car, instead using public transport and his bike. “When I need a car I rent one,” he says, so he is staying loyal to the nature of his business model in this regard too.