Hudson’s Bay Company, which owns Saks Fifth Avenue, will take a majority stake in coworking and flexible office firm Convene.
This news comes as HBC continues to expand its coworking arm, which the firm is confident will play a significant role in the future of work,
The department store owner will partner with private equity firm Ares Management, as well as Convene’s shareholders, and invest millions to expand Convene. The deal is valued at around $500 million according to Hamid Hashemi, chief operating officer of HBC’s property sector.
Once the deal is complete, HBC will expand Convene’s facilities and convert some of its former retail stores into office spaces.
Retail is one of many industries that suffered from the pandemic, leaving many storefronts vacant. To combat this, real estate firms have started refurbishing empty space within shopping centers and malls to repurpose these vacancies, while encouraging traffic to surrounding businesses.
Previously, HBC partnered with coworking firm WeWork for an initiative called SaksWorks, which converted portions of Saks Fifth Avenue locations into coworking spaces.
After the deal is complete, these spaces will be rebranded as Convene and be under the leadership of Convene CEO Ryan Simonetti’s new management team. Additionally, HBC has agreed to offer around 20 properties from its holdings to open new workspaces in previous retail storefronts.
Currently, the combined company has 26 locations, which includes 23 workspaces and meeting rooms that were initially leased by Convene.