HomeNewsletterParking Lot Tech? REEF turns Lots into Neighborhood Hubs

Parking Lot Tech? REEF turns Lots into Neighborhood Hubs

REEF Technology secures $700M investment to remaking parking lots

SoftBank and Mubadala Corp. recently put their continued faith in the commercial real estate industry on display when it invested $700 million into REEF Technology, TechCrunch reports. REEF, which began as a hardware, software and management services provider for parking lots, now also adds infrastructure for cloud kitchens, healthcare clinics, last-mile delivery, traditional brick and mortar retail and more.

“We believe REEF’s conversion of city parking lots into urban logistics hubs makes them much more useful than in their current form,” SoftBank Managing Partner Ervin Tu said in a statement. “As we have witnessed during the pandemic, proximity to the consumer is increasingly important in today’s economy. We’re excited about management’s vision of transforming and revitalizing the urban center, and are confident in REEF’s ability to execute.”

The investment may come as surprise to some given the company recently invested in another real estate concept—WeWork, which has had a variety of financial issues over the last year or so. SoftBank and Mubadala have doubled down on another CRE model because they’re confident REEF will have success. Both WeWork and REEF lease a majority of the real estate they operate and upgrade it prior to leasing it to other tenants.

The difference, and why REEF is more likely to succeed, is REEF operates its own businesses on its sites and works with startups to provide tangible goods and services that are location dependent for their success and to create revenue.

“We are excited for this next stage of growth and are committed to continue learning, listening and working with our communities to reimagine urban real estate into localized and networked infrastructure that entrepreneurs and cities can use to deliver goods and services sustainably and directly to our neighborhoods,” REEF Technology CEO Ari Ojalvo said in a statement. “By working together, we can reimagine and rebuild our urban spaces for people, not just cars, and help our cities become more sustainable and inclusive centers of community and opportunity.”

Where the $700M investment will go

REEF will use Softbank and Mubadala’s investment to scale from its 4,800 locations to 10,000 locations across the United States and convert parking lots into “neighborhood hubs,” TechCrunch reports. Oaktree, UBS Asset Management and European venture capital firm Target Global are also joining in on the financing. REEF is also working with Oaktree on a $300 million real investment venture, the Neighborhood Property Group. If everything comes together, REEF could be deemed the “WeWork for the neighborhood store” and have $1 billion in capital to create what it calls a proximity-as-as-service platform.

There’s good reason to be optimistic about REEF Technology’s prospects. The company started as ParkJockey, before taking a minority investment from SoftBank in 2018 and turning into REEF Technology. Since that time, the company added a cloud kitchen business that has supported the growing number of virtual restaurant chains. REEF has also added companies like DHL and startup Bond for last-mile delivery, national primary healthcare services clinic operator and technology developer Carbon Health and electric vehicle charging and maintenance provider Get Charged as partners.

REEF also plans to launch its first experimental open-air entertainment venue in Austin next year and later on, act as a hub for the data processing centers and telecommunication platforms that could power future smart cities.

“We have inbound interest from companies that do edge computing and companies getting ready with 5G,” REEF Technology co-founder and Ojalvo told TechCrunch. “Data and infrastructure is a big part of our neighborhood hub. It’s like electricity. Without electricity and connectivity, we don’t have the world we want to see.”

A majority of REEF Technology’s revenue is still coming from its parking business, but Ojalvo expects the company portfolio to become more diversified as its cloud kitchen business expands.
“Neighborhood kitchens will be a significant part of non-parking revenue,” he said.

“This round of funding provides an exciting opportunity for our team to continue expanding the REEF digital platform,” REEF Co-Founder and Head of Product Philippe Saint-Just said in a statement. “We’re especially proud to be able to provide local restaurants with solutions that they need to thrive.”

Joe Dyton can be reached at joed@fifthgenmedia.com.

- Advertisement -
- Advertisment -spot_img

Industry News

- Advertisement -