Blackstone Inc. has quietly built the largest flexible office brand in London’s central districts.

The private equity firm’s platform, which it originally bought as The Office Group but has today re-branded following a merger with Brockton Capital’s Fora last year, now boasts more locations in London’s zones one and two travel districts than any other flexible office brand. WeWork Inc., which has filed for bankruptcy in the US, became the biggest private sector occupier of London office space in 2017 but has since retreated in an attempt to cut its worst loss-making locations.

While WeWork’s bankruptcy filing has shaken the sector and threatens to make landlords more reluctant to rent space to serviced office providers, demand for flexible space in the UK capital has bounced back since the pandemic. The short term leases also offer the potential to better hedge against inflation, enabling landlords to capture rising market rents more quickly as contracts are renewed more frequently.

“The steady recovery that we have seen in this business over the past two years, including a recent return to pre-Covid occupancy levels, has continued in the final quarters of the year,” said James Seppala, head of European real estate at Blackstone. “This gives us significant confidence in its prospects moving forward.”

Fora now operates a combined 61 sites in central London, overtaking both WeWork and Regus, the brand owned by IWG Plc that’s among the oldest in the sector. WeWork at its peak had more than 50 sites in central London but its website currently lists 35 buildings with the future of some sites uncertain as it seeks to renegotiate leases. A spokesperson for WeWork did not respond to emails seeking comment.

Regus currently has 36 locations in central London and parent IWG has an additional 29 sites that it runs via its other brands, which include Spaces, HQ, Signature, Clubhouse and Engine Room, according to numbers emailed by a spokesman.

In contrast to WeWork, Fora mostly owns its buildings, though it does have some leases and some management agreements where it splits revenue with the landlord. The tendency to own reduces the duration mismatch of having long-term liabilities from long leases with buildings’ owners and short-term income from renting them out on shorter terms.

The Office Group had 36 locations when Blackstone acquired its majority stake from Lloyd Dorfman in 2017 in a deal that gave the company an enterprise value of £500 million ($635 million), according to a press release at the time. The merger with Fora announced in March last year, created a group with 72 locations overall, according to a press release from the companies announcing the deal, including some in Germany and other UK cities.

Fora was backed by a fund managed by Brockton Capital which now jointly owns the combined business with Blackstone. The business was valued at about £1.5 billion at the point of the merger, the person said.

Blackstone Real Estate Partners Europe V, the fund through which it originally acquired the Office Group in 2017 had invested €203 million in the business through the end of June, according to an investor letter seen by Bloomberg News. The fund had marked down that valuation to €170 million as of the end of the second quarter, giving it a gross internal rate of return of -3.6%.

The valuation has since risen as occupancy has recovered to more than 90% from the lows endured during the coronavirus lockdowns and rents have risen higher, the person added.

A Blackstone spokesperson declined to comment on the business valuation or financial performance of the investment.