CEO Series

"We Don't Want To Reach 100% Occupancy Too Fast" And More, Confessed By Colony's Timothy Tiah

There’s a few things about Timothy Tiah’s new co-working space that stood out to us.

In his opening speech at Colony’s opening, he doubled down on how this new space exists to change the way we approach offices here in Malaysia.

That’s why Colony is referred to as a co-working serviced office. We took a little tour of the area and it exudes a sense of cosy classiness that stirred up all the office envy in us.

This office’s main focus is to keep employees happy.

There’s tonnes of places to lounge around and work in if you want to get out of your four walls, and Colony also provides other little treats like nap rooms (one with a hammock), a cafe, massage spaces, a playroom for the kids, and even a lactation room.

Timothy even spoke of a future nursery, if the tenancy rate works out for them.

This all exists in service of the idea that employees should be comfortable in the space.

In our interview with him, Timothy Tiah added that, “It’s true that some people on our team have hospitality backgrounds because, at the end of the day, it’s hospitality at work.”

“Hotels are good at these things. Sometimes the managers of a hotel send a private note, or they check in on how you’re doing. But nobody does that at work. ”

Instead of just providing a nice little space to work in, what Timothy wants to emphasise about working in Colony is the experience.

He admitted that this is still a work in progress in Colony and that his team is still learning how to get this done.

“I own 73% [of the Colony’s stakes] but I’ve passed down about 7 and a half percent to our own staff, because essentially I want the key majority to own a part of this.”

He truly wants staff who believe in maximising the tenent experience.

“One day, I hope our team can see if someone is having a bad day, and maybe buy them a cup of coffee to cheer them up, or maybe a note.”

“That’s why I’ll be worried if we get 100% occupancy too fast, because we can’t do that in a scaled manner. But if we do well for the people that we have right now, they’ll spread the word themselves. And you don’t even have to spend a single cent on marketing.”

The space has a 42% occupancy, and that’s exactly where Timothy wants to be at the moment. 

Timothy at Colony’s inaugural speech / Image Credit: Colony

At the current occupancy levels, Timothy and the team at Colony are able to test the waters for what he aims to be a franchise.

“My target was 60% occupancy by December,” said Timothy.

“We’re not far, but my hope is that we don’t reach 100% until we’re ready. I don’t want the experience of this place to slip or our service levels to drop.”

At full capacity, Colony can fit a little less than 300 people, but Timothy doesn’t see that as ideal.

With all of them packed into the two-story space, “this place is going to be like a pasar malam,” he said with a chuckle.

“My ideal is about 80%. I’m afraid that if I hit 90%, the experience will deteriorate.”

If things go smoothly, the Colony could break even by September. 

The main event space, where they held one for Maybank last week

“The rent gives me a heart attack every now and again, but we’re quite lucky,” said Timothy.

When asked about the sustainability of the area, Timothy told us that an occupancy at 40%–50% would already help them to a break even.

Anything above that is pure profit. And the great thing is, what helps us a lot is events. When people book events, they can pay up to RM10K a day, depending on number of pax. But it’s a lot of hard work, to be honest.”

“Last week we had a Maybank event where I was literally carrying furniture up and down the stairs,” Timothy told us with a chuckle.

But they haven’t broken even quite yet, despite having an occupancy at 42%.

“The 42% occupancy, it’s also from people who are only coming in this August or September. But I think by September, the leases for those kick in and we start earning money.”

But why would employers fork out the extra cash to let their employees have naps and massages at work? 

We know where we’d spend all day.

To Timothy, the hardest part in this whole business is convincing the bosses. And for money-crunching bosses who eye the bottom line like a hawk, the value of a space like this is not immediately obvious.

If he went up to these bosses to try and sell the idea of community to them, “The bosses will say, ‘I don’t care about community, why would I bother?'”

Instead, his strategy is another pain point—staff retention.

“I’ll ask them: What’s your turnover like? How much money have you lost from staff turnover? When people leave and you have to recruit more, training period, it’s all disruption to the business. How much does all of this cost your company? If I could reduce it by giving you this kind of environment to work in, I think that’s a convincing argument to make.”

This will take a lot of education on his part, because from the bosses’ perspective, “I put them here, every day they massage, they sleep, they won’t work.”

But that is the old way of looking at work culture. In this post-Google office world, the workforce wants different things. It’s not just about sitting at your desk and working all day.

Timothy stated that “We want to work in a café every once in a while. We want to work in a lounge area, we want to be able to take naps when we need to, we don’t want office coffee, we want Espressolab or Starbucks. I think that’s the hardest part, but that’s what I’m committed to do to convince everyone.”

And this seems to be the plan. According to Timothy, the people who have joined them so far are the kind of people who rely on quality talent.

He already has his eye on location two and three. 

Colony was always intended to be a franchise, and Timothy’s team hopes to expand to two more locations within the next 5 years.

He told us that he’s already eyeing Mid Valley and Sunway as his next pitstops, and that it’s no secret.

Since his competition is other offices, Timothy doesn’t look at where the other co-working spaces are. Instead, he’s looking at how much the rental is in the next-door building.

Setting up in the heart of KL, Timothy credits the high rent of the area as the opportunity for Colony to stand out, versus trying to fight other co-working spaces.

“I did a very employee-focused survey about where do people want to work. I did it on my blog, there were approximately 7,800 responses, and surprisingly, the top 3 areas people wanted to work in are Sunway, Mid Valley and KLCC.”

“This surprised, me, because these 3 areas are the most jammed areas in Klang Valley.”

“As I dug deeper, I realised that people wanted to work in the center of business activity, and the center of ledger activity. Here, after work I can walk to Pavilion, it’s just a 3–4 minute walk and have drinks with my friends.”

“Or I can go to the mall to pick up something and come back, so I don’t have to make a trip during the weekend to pick it up, or have lunch, or catch a movie. It’s a part of life. ”

“I was asked before if the next space is going to look like this, and the answer is—probably not. One thing is that the next space is going to look different. Right now if you look at all the co-working spaces, they’re all very internet startup-ish. Or very hipster, or industrial.”

“We went for something completely different, and the next one is going to be completely different as well. We do have an idea, but my wife just finished this one, so I’m going to have to give her a break first before I ask about the next one.”

Feature Image Credit: Colony

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