Industrious, a New York-based co-working startup founded in 2013, has been acquired by CBRE, the world's largest real estate firm, in a deal valuing the company at approximately $800 million. CBRE, which had been an investor in Industrious since late 2020, is set to purchase the remaining equity stake for around $400 million. This acquisition marks a significant milestone in the co-working sector, highlighting the viability and attractiveness of the co-working business model.
Industrious, which began as a modest startup, quickly rose to prominence in the co-working industry. The company successfully raised a total of $522 million from notable investors such as Riverwood Capital and Fifth Wall Ventures. Under Riverwood's investment period, Industrious experienced exponential growth, expanding 24 times its size. By February 2023, Industrious boasted 583 employees and had moved away from capital-intensive real estate leases to forming strategic partnerships with property managers.
CBRE's decision to acquire Industrious underscores the growing demand for flexible and innovative workspace solutions. The acquisition will lead to the formation of a new business segment within CBRE called Building Operations & Experience (BOE). This unit aims to "unify building operations, workplace experience and property management," integrating several services provided by Industrious, including lobby activation, office design, and workplace services.
“When we started this company, it was a lark. It was a fun idea at the right time. Now, in a world pulling us towards isolation and the narrow ten-inch frame of our phone screen, it’s something closer to a calling: a place where people can get out of their home and impact the world around them, be exposed to new people and ideas, and be treated with kindness.” – Jamie Hodari
Jamie Hodari, CEO and co-founder of Industrious, will take on a dual role following the acquisition. He will lead the new BOE business unit while serving as CBRE’s chief commercial officer. His leadership is expected to drive the integration and expansion of CBRE's newly acquired assets.
The acquisition is anticipated to close later this month and is projected to be "immediately accretive" to CBRE's 2025 core EBITDA and free cash flow. This strategic move not only enhances CBRE's portfolio but also solidifies its position in the evolving real estate landscape.
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