Tuesday, April 16, 2024
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HomePressCBRECBRE invests another $100M in flex office space provider

CBRE invests another $100M in flex office space provider

CBRE’s confidence in the co-working concept has not wavered, as the real estate firm recently announced it invested $100 million in flexible workspace solution provider Industrious.

The investment will allow Industrious to expand its international presence and execute key strategic growth initiatives. Earlier in May, the company announced it acquired The Great Room in Asia and Welkin and Meraki in Continental Europe.

“We’re very excited to build on our industry-defining partnership with CBRE,” said Industrious Co-founder and CEO Jamie Hodari. “The investment rests on our shared understanding that there is a monumental opportunity in front of us as companies rethink their real estate strategies. CBRE’s investment assures we have the capital we need in the coming years to grow on a global scale to meet current and future demand for flexible space.”

Previously, CBRE invested approximately $230 million in Industrious in late 2020 and early 2021. The most recent investment is in the form of a convertible preferred-equity security. CBRE remains Industrious’ lead minority investor.

CBRE’s investment is a sign of its strong belief in the co-working space provider’s ability to capture a growing share of this fast-growing market. Almost 60 percent of U.S. occupiers believe flex space will be a significant part (more than 10 percent) of their portfolio within two years, according to CBRE’s 2022 occupier survey. Last year, just 35 percent of occupiers surveyed felt that flexible office space would make up a significant part of their portfolio.

“Although companies’ real estate portfolio mix has historically been a combination of leased and owned space, we see the trend shifting to a combination of leased, owned and flex space in the future,” according to Industrious Chief Growth Officer Craig Robinson.

Those planning to add more flexible office space will use it to test alternate workspace or occupancy models and designs, while reducing their capital expenditure, according to the survey. Some measures will include offering employees meeting and collaboration space on demand and offering employees more choice in where they work.

“As companies grapple with new space utilization patterns, flexible office space is a viable strategy to satisfy immediate needs while preserving the agility to change course as lessons are learned,” the survey said.

“Industrious’ sector-leading customer satisfaction scores, outstanding management team and business model set it apart in the flex-space sector,” said Emma Giamartino, CBRE’s chief financial and investment officer. “We are excited about the significant opportunities available to Industrious to bring its innovative, amenity-driven approach to more occupiers and investors around the world.”

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