[UPDATE] The Great Room acquired by CBRE-backed co-working operator Industrious
/ EdgeProp Singapore |
The Great Room has five locations in Singapore, including Ngee Ann City (pictured)
SINGAPORE (EDGEPROP) - Co-working operator The Great Room has been acquired by US flexible workplace provider Industrious as part of its push for international expansion. On May 9, the New York-headquartered firm announced its acquisition of The Great Room as well as European co-working player Welkin & Meraki.
According to a source quoted by Bloomberg, Industrious paid around US$100 million ($139 million) in cash and stock for the two companies. The deal immediately adds over 350,000 sq ft to its portfolio across six new markets in Asia and Europe, as well as a 600,000 sq ft pipeline of new deals across key cities in the two regions.
Conservatory at The Great Room Afro-Asia (Photo: The Great Room)
The Great Room’s portfolio consists of approximately 180,000 sq ft across seven locations, including five in Singapore located at One George Street, Centennial Tower, Ngee Ann City, Raffles Arcade and Afro-Asia. Its two remaining locations are in Hong Kong and Bangkok, respectively. Meanwhile, Welkin & Meraki operates five flexible workplace locations across Paris, Eindhoven, and Brussels.
Both The Great Room and Welkin & Meraki will continue to operate under their respective brand names.
“We are thrilled to bring on The Great Room and Welkin & Meraki within the Industrious ecosystem, especially given our aligned intent to provide high-quality, flexible workplaces,” says Jamie Hodari, CEO and co-founder at Industrious, in a press statement. “We look forward to expanding our offering on a global scale to better support work-from-anywhere models, while keeping our commitment to the highest customer satisfaction in the industry.”
Hodari: We look forward to expanding our offering on a global scale to better support work-from-anywhere models (Photo: Industrious)
Jaelle Ang, CEO and co-founder of The Great Room, believes the acquisition will strengthen the group’s positioning, given the boost in scale and network. Post-transaction, Industrious now holds some five million sq ft of flexible workplace worldwide. Members of The Great Room and Welkin & Meraki will be able to access workspaces within the Industrious locations, and vice versa. “I think there’s immediate cross-sell and revenue synergies, as well as a stronger value proposition for members,” she says in an interview with EdgeProp Singapore.
Ang remains as CEO of The Great Room, reporting to Hodari. She notes that the deal enables The Great Room to be better-capitalised for growth within the flexible workspace segment, which she predicts will grow over the next 10 years to make up some 30% of total commercial space globally from its current level of 3%.
Noting that The Great Room and Industrious share the same values in terms of a human-centric approach to design, warm service, and serving the current and future needs of members, Ang also points out that through the partnership, the firm will able to tap Industrious’ best practices. “I think there's a lot to learn because they have been in business for much longer,” she comments.
Ang: [With the acquisition,] I think there’s immediate cross-sell and revenue synergies, as well as a stronger value proposition for members (Photo: The Great Room)
Industrious’ main market is the US, where it operates over 150 locations in more than 50 cities. The firm’s portfolio has grown rapidly since the start of the pandemic, with roughly one million sq ft of space added to its portfolio in 2020 and over 1.1 million sq ft added in 2021.
Last February, Industrious crossed a new milestone when CBRE Group made a US$200 million investment in the firm, acquiring a 35% stake in the company that was later bumped up to 40%, cementing its position as majority shareholder. CBRE’s flexible-space solutions company, Hana, was also merged into Industrious, boosting its portfolio in the US and marking its expansion in the UK with locations in London and Manchester.
Industrious operates over 150 flexible workspace locations in the US, including Industrious Fulton Market in Chicago (pictured) (Photo: The Great Room)
Looking ahead, the group plans to double its international presence by the end of the year. Asia Pacific (Apac) will play a significant part in its growth trajectory, notes Ang. “There’s a very strong commitment to grow across Apac,” she says, noting that the expansion will be fuelled by both organic growth and M&A activity.
For The Great Room, Ang shares that the firm recently signed a deal for a sixth location in Singapore, at Eu Yan Sang Building on South Bridge Road. Spanning over 20,000 sq ft, the new location is slated to open in January 2023.
The Great Room is also negotiating further deals to expand in its current markets, while there are also plans to venture into new markets, with immediate priorities including Sydney, Tokyo and Shanghai.
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