Career Advice Successful High flyers’ story

Flexible approach spurs growth

Paul Salnikow has built a resilient business that meets changing needs, writes John Cremer.

In challenging times, some businesses emerge as naturally more resilient, and that is proving to be the case for The Executive Centre (TEC). The Hong Kong-based provider of premium flexible workspace and support services has been helping clients remain in action and fully productive during the recent disruptions, with office facilities, video-conference links and IT back-up available 24/7 if necessary. 

“We are like a safe haven in troubled times, and had a very strong year in 2019,” says Paul Salnikow, TEC’s chairman and chief executive, who oversees close to 140 centres in 14 countries and 32 cities stretching across the Asia-Pacific and Middle East regions. “If business people are unable to make long-term commitments because they don't know what’s happening, we offer shorter-term accommodation where they have flexibility, convenience and, potentially, the space to grow.”  

Typically, existing clients tend to be in financial services and banking, consulting and professional services, and well-established   technology firms, as opposed to start-ups. The basic format offers upmarket locations, easily customised layouts, conference rooms, breakout spaces, lounge areas, ergonomically designed furniture, and the cabling and secure networks needed to monitor financial markets and guarantee high-speed connectivity. 

If travelling, the 27,000 or so individual members have ready access to centres in other cities and on-site secretarial support to help organise their business lives, including banking arrangements, representation and even corporate events. And the pattern of contract extensions with TEC – plus interest from new clients – is taken as clear indication that the formula is one that works.   

“We’re providing a full-service environment, not just space,” Salnikow says. “As a result, the business is self-sustaining and delivering on promises of success and profitability.”      

Descended on his father’s side from the Russian nobility – the family fled their home and estates in 1919 after the revolution to settle first in Belgrade and later in Argentina – Salnikow has always felt comfortable in an international environment.   

His parents met at university in Buenos Aires - his mother’s family had moved from France after the Second World War - and his father began with IBM before accepting a company transfer in the 1960s to the melting pot of Manhattan and building a successful career there until retirement.  

“The United States was the Promised Land, but I grew up speaking Russian, knowing Russian history, and I have an international perspective,” he says. “I’m an American, but since 1989 I’ve been almost permanently overseas. That wasn’t really a conscious decision; I’ve just taken advantage of the opportunities I discovered wherever I happened to be.”  

In the normal course of things, Salnikow had attended public school in New York before completing a business degree at Georgetown University in 1985 and following that with a two-year MBA at Sophia University in Tokyo. Contacts made at a graduate jobs fair there led to an offer from Haseko Corporation, a major Japanese property developer, and a place on their on-house training programme. 

“I was on a journey of discovery in Japan and looking for something entrepreneurial,” he says. “I’m not really a ‘corporate guy’, but I loved the whole idea of property and how it provides the building blocks for so much else.”  

After basic induction and training, he was assigned first to the New York office and then to London, as the token western face in a team of Japanese colleagues charged with looking for potential investment and partnership deals. 

One initial task was to locate suitable fitted-out office accommodation – reasonable lease terms and flexible space with room for growth – and the difficulties in finding that in late 1980s London sparked the train of thought that subsequently led to founding TEC.  

“The shortest lease we could sign was for 14 years; it was crazy. I took it as a lesson and started thinking about the concept of a ‘hotel for companies’. Back then, my role was a combination of troubleshooter and gofer. London was my training ground. We bid for the Paternoster Square site for redevelopment, and I went on to become a dealmaker for the company.”   

That experience brought a transfer to Hong Kong in 1990 to open an office – it once again proved difficult to find suitable temporary space - and establish joint ventures with local developers. However, the Japanese recession disrupted those plans, so Salnikow switched instead to managing a property fund and then acted as an independent property consultant advising on strata-title acquisitions.  

“I became a good Hong Kong wheeler-dealer,” he says, adding that in 1994 the time seemed right to launch TEC, with the support of private equity backers, by taking half a floor in the Bank of America Tower.    

“We used that as a springboard to get members and expand. I was confident because I had experience of needing this kind of ‘product’. Hong Kong is a commercial city. People come here to do business, so the idea made perfect sense for this market.”   

Since then, he has engineered steady profitable expansion, with 1,000-plus employees generating latest annual turnover exceeding US$275 million, capping average yearly growth of close to 20 per cent for well over a decade. 

Investors have changed along the way and - economic conditions permitting - that could happen again, with the possibility of an IPO somewhere down the line. But in the meantime, the firm expects to continue opening in new locations, while also adjusting to meet clients’ changing needs and functional preferences.  

“We’re large because what we do has been successful over time and we reinvest profits for growth,” Salnikow says. “My vision is to make this a permanent business and to stay with it.”   

When off duty, having four children means family time comes first, but Salnikow is also a keen hiker and has plans for a two-week trip with friends to Georgia/s Caucasus mountains later this year.  

“I find hiking is a great way to challenge yourself and clear the mind,” he says. “It fits my personality and is a good hobby which totally satisfies.”