Filinvest Land Inc. has formed a P100 million joint venture with KMC Community Inc. for the development, management, operation, and maintenance of co-working spaces.
In a disclosure to the Philippine Stock Exchange, FLI said they will be developing flexible workspace facilities offering private serviced office seats and co-working seats in commercial buildings which will be managed by KMC.
Prior to execution of the Joint Venture Agreement, FLI already caused the incorporation of the new company, which shall be the entity that will be used by the Parties in implementing the JVA.
Except for registration with the Bureau of Internal Revenue and in the local government where it will operate, there are no other known regulatory requirements for the joint venture.
Co-working spaces are a rapidly growing industry that have been experiencing an increase in demand as of late. This growth is being driven by a number of factors, including the rise of remote work, increasing popularity for multiple office venues, and the growing demand for more conducive work environment.
Further, due to the incentives allowed by the Philippine Board of Investments and the Philippine Economic Zone Authority to its locators, there is an ongoing shift in the manner that office spaces are used (traditional office) moving forward.
By entering into the Joint Venture Agreement, FLI said it can leverage the expertise and experience of KMC in the flexible co-working space industry.
Also, by partnering with a company with a strong branding, FLI will be able to increase its brand awareness in the co-working space industry and be able to reach new markets and expand its operations to multiple locations.
The total amount of investment is P100 million. Under the JVA, FLI and KMC shall subscribe to 70 percent and 30 percent, respectively of the authorized capital stock of the Joint Venture Company.
Profit sharing will be based on equity interest participation in the Joint Venture Company. Subject to the approvals required under the Revised Corporation Code, KMC shall be appointed to manage the business on such terms and conditions as may be agreed upon by the Parties.