- CBRE has acquired its 35% ownership in Industrious in the form of primary and secondary shares.
- As part of the agreement, Industrious will take over operations of CBRE’s coworking arm, Hana.
- While many flexible workspace operators continue to struggle as a result of the coronavirus pandemic, Industrious continues to thrive, having grown by more than 1 million square feet in 2020.
CBRE has invested $200 million in flexible workspace provider Industrious, making it Industrious’ largest fundraise to date.
The investment gives CBRE Group 35% interest in the flexible workspace company and makes it the largest shareholder of Industrious. CBRE is also expected to acquire an additional 5% of Industrious in the coming weeks.
As part of the agreement, CBRE executives will join Industrious Board of Directors. CBRE’s coworking arm, Hana, will also be merged into Industrious as part of the agreement. According to the release, when the transaction closes, Hana locations in the U.S. and U.K. will be operated by Industrious.
Industrious Continues to Thrive despite COVID-19 Pandemic
“This investment would be a milestone at any moment, but it’s especially meaningful amid a pandemic that continues to reshape our business. This signifies that Industrious has emerged as the leading flex platform moving forward,” an Industrious spokesperson stated.
“Industrious had a number of offers to consider late last year and was approached by a lot of potential investors. In the end, partnering with CBRE just made too much sense for Industrious’ long-term plans for scalability and growth.”
The COVID-19 pandemic delt the flexible workspace industry a hard blow. With coworking centers closed and a drop in membership numbers, many operators struggled to make ends meet in order to pay rent. Large operators—including Knotel, Regus, and Serendipity Labs—filed for bankruptcy; and small and medium ones closed their doors—including The Riveter and Breather.
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While some flexible workspace operators struggled last year due to the coronavirus pandemic, Industrious continued to expand and grow amid the pandemic. The flexible workspace company grew by more than 1 million square feet in 2020, growing from 92 active locations in 2019 to 107 in 2020.
Industrious’ focus on management agreements is, in large part, the reason behind the company’s success even during trying times. Management agreements represent nearly 90% of Industrious’ portfolio.
The Future Is Flex
Despite the negative short-term effects the coronavirus pandemic has had on the flexible workspace industry, experts believe the flexible workspace industry is poised to thrive in the post-pandemic business world.
CBRE’s survey found that 86% of its occupier clients, which include many of the world’s largest global corporations, plan to incorporate flex office space in their real estate strategies, and 82% will favor buildings that offer a flex-office component.Share this article