For decades, the 1971 glass cube at San Francisco’s 345 Montgomery St. was the flagship retail location for Bank of America, which had its global headquarters next door.

But the bank’s headquarters moved to North Carolina after a 1998 merger. It later closed the retail space.

Next year, 345 Montgomery will see new life: Co-working company Spaces signed a 78,000-square-foot lease to occupy the entire building, which is in the midst of a $45 million top-to-bottom renovation.

It is Spaces’ third and largest location in the city, after 95 Third St. and 1160 Battery St. It marks another expansion for the booming co-working industry, which charges office workers monthly fees for shared desks and private offices. It’s also a sign of San Francisco’s changing economy, where financial services companies are yielding to tech startups.

Spaces and its sister brand, Regus, are owned by IWG PLC, the second-largest co-working operator by square footage in San Francisco, according to real estate broker Cushman & Wakefield.

The 345 Montgomery location is “a landmark opportunity for us” and “a chance to grab a spot in the center of the central business district,” said Michael Berretta, IWG’s vice president of network development for the Americas. The company plans to hold large public events at the location and will have access to an outdoor public plaza.

The three-building former Bank of America complex is the city’s second-most-valuable property based on taxes. Bank of America still retains a major presence in its former headquarters space at 555 California St., along with other financial firms such as UBS and Goldman Sachs. But in recent years, tech companies including Microsoft and the mobile game maker Supercell have opened offices.

“It’s becoming more diverse, with tech, media along with the obvious financial services community,” Berretta said. “It’s a really healthy mix, long term, for a city like San Francisco.” Spaces members include tech companies as well as other industries, he said.

Vornado Realty Trust owns 70 percent of the complex, and President Trump’s company owns 30 percent, which has made it a target for protests.

“We’re very proud that IWG selected this highly visible site to showcase its latest offering,” David Greenbaum, Vornado New York division president, said in an earnings call Tuesday. He said the three buildings, which occupy 1.8 million total square feet, are fully leased.

Through its broker, CBRE, Vornado declined to comment further.

IWG’s Regus brand has been in San Francisco for decades, but it’s been recently eclipsed in size by WeWork, the dominant player in the Bay Area and world. It leases 1.1 million square feet in San Francisco, or nearly three times as much as Regus and Spaces. WeWork is replacing a bank facility as well, leasing the entire Union Bank Building at 430 California St. in its biggest deal in the city. WeWork declined to comment.

“For sheer volume, WeWork is well ahead of the pack, but this location will absolutely give Regus and Spaces a more prominent presence here in San Francisco,” said Robert Sammons, regional research director for Cushman & Wakefield.

Berretta said IWG’s longevity — it was founded in 1989 as Regus — gives it an edge. “Our distinct advantage is we have customer relationships that go back 15 to 20 years or more,” he said.

The booming economy means multiple co-working companies can expand in the Bay Area and still attract members, who are attracted to the flexibility, said Ken Rosen, chair of the Fisher Center for Real Estate and Urban Economics at UC Berkeley.

“That is truly transforming the demand for office space. Increasing numbers of Fortune 500 companies want co-working space,” Rosen said. They can plug and play, expand and contract, without a long lease commitment.”

But Rosen is pessimistic about the industry’s prospects if the market cools. Companies such as WeWork and Spaces sign long-term leases but rely on short-term membership payments, which can fluctuate.

“When the downturn happens, they’re going to have difficulties,” he said. “Then we’ll see a lot of bankruptcy.”

More Information San Francisco’s largest co-working firms Company Square footage WeWork 1,170,200 Regus and Spaces 437,727 RocketSpace 138,436 Galvanize 68,405 Werqwise 45,031 Industrious 49,862 Hatch Today 41,079 Mindspace 36,111 Tech Space 25,086 Carr Workplaces 21,733 Source: Cushman & Wakefield

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There’s a precedent. IWG, then known as Regus, filed for bankruptcy protection in 2003 after the dot-com collapse. It’s since recovered, and Berretta said the company will be more resilient in the next downturn.

“It’s not all associated with one industry like the dot-com businesses,” he said. “We’re now in a position to be successful in a variety of economies.”

Berretta said both Spaces and Regus are seeking to expand throughout the Bay Area.

“Despite the dramatic increase in total flex-space square footage in our fine city, demand still outweighs supply, so we should all expect more growth,” said Tom Poser, a broker with JLL who represented Spaces.

But the company is being picky about locations.

“The Bay Area in general is a market we want to be very careful in,” said Berretta, citing the high rents and competition among tenants. “We want to make a long-term decision here that’s smart for us.”

Roland Li is a San Francisco Chronicle staff writer. Email: roland.li@sfchronicle.com Twitter: @rolandlisf