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Industrious Raises $80M in Funding Co-Led by Fifth Wall, Riverwood

Rapidly growing Brooklyn-based flexible workspace provider Industrious, which has attracted members from Hyatt, Instacart, Chipotle, Fullscreen, Mashable and Pivotal, is about to get even bigger.

After tripling the number of its locations in the U.S. to 35 over the past three years, Industrious has completed its latest fundraising round and pulled in $80 million in Series C funding co-led by Los Angeles-based Fifth Wall Ventures and Riverwood Capital, according to an Industrious news release today.

The company has now raised a total of $142 million since its founding in 2013, according to a spokeswoman. It plans to further its expansion by adding about 30 more locations this year. Also Industrious is projecting its revenue growth will triple this year, according to Jamie Hodari, a co-founder and the CEO of Industrious. He also said that in 2018, the company plans to launch an app that will help connect tenants to events. He declined to go into further detail about the product.

“Our network is growing very quickly and that is a capital intensive proposition,” Hodari told Commercial Observer. “We have to be able to serve our customers where they are, wherever that is across the country.”

img 0036 Industrious Raises $80M in Funding Co Led by Fifth Wall, Riverwood
Industrious plans to open many new locations around the country this year. Photo: Industrious

Other investors in the funding round include Alrai Capital, Outlook Ventures, Rabina Properties, Schechter Private Capital and Wells Fargo Strategic Capital, the release indicates.  

Fifth Wall, a venture capital firm that invests in burgeoning real estate companies, is backed by major property owners such as Hines, mall-operator Macerich, Prologis and Rudin Management Company. (Industrious is not the first coworking provider that Fifth Wall has invested in, but it is the first that has been publicly announced.) It has already invested in VTS, Appear Here, WiredScore and Enertiv, as CO reported first in January.

The company chose to invest in Industrious because of its ability to attract Fortune 500 companies to its model.

Industrious does not create flashy spaces designed with startups in mind, but implements sophisticated designs with actual offices—and a handful of coworking desks—at its locations.

“It’s an elegant, simple, refined aesthetic that attracts large companies,” said Brendan Wallace, Fifth Wall’s co-founder and managing partner.

Wallace added that Fifth Wall also selected Industrious because he believes the office space provider partners more with landlords than do its competitors, based on the structure of the lease agreements it signs.

The Fifth Wall co-founder declined to elaborate, but said Industrious is different than say a WeWork, which signs a lease and then fills its spaces with members whose collective fees work out to much more than the price of the original lease. In WeWork’s case, the coworking giant receives more upside than the landlord does for the space. (A spokesman for WeWork declined to comment.)

“I think that landlords have grown increasingly cautious to coworking players, including WeWork,” Wallace said. “What [Fifth Wall’s investors] were looking for was a coworking partner to deploy across their national footprint.”

Source: commercial

Newark Connected & Cost Efficient: Why Your Company Should Move to Newark

Recently, Amazon named Newark as one of the top finalists in the company’s HQ2 location search. To those familiar with the Brick City, this came as no surprise; Newark has long enjoyed a host of infrastructural and geographical advantages — it’s just 20 minutes from New York City– that have made it a growing business hub.

Amazon isn’t the only business looking to make moves in Newark. Other established, multinational companies have also turned to the city as a viable option for their corporate headquarters, including Audible Inc., an Amazon-owned company which employs 1,000 workers to produce and sell audio entertainment. Mars Wrigley Confectionary, the chocolate company behind M&M’s, recently announced that one of its U.S. headquarters will open in Newark by July of 2020, bringing with it about 500 new jobs to the city.

In December, Broadridge Financial Solutions, a fintech company that provides technical services to financial institutions moved 1,000 employees in December from Jersey City to 2 Gateway, a building in the heart of Newark. Standard Chartered Bank, a London-based institution, which provides financial products and services to corporations, is another company at 2 Gateway that recently signed a lease extension for 72,319-square-foot office space. The 2 Gateway building has also signed leases with other businesses across multiple industries in 2017, including one with award-winning architectural and design planning firm Minno & Wasko back in December. The list goes on.

The leasing velocity in the Newark submarket has more than doubled year-over-year and that’s because companies are now looking to Newark as a locale that isn’t just practical, but attractive for its executives and employees alike. The city’s downtown is just one stop away from New York City with commercial rent cost at a third of the price of what a company would pay if they were to operate in Manhattan. It’s also less expensive than Jersey City and Hoboken, and effectively just as close to NYC. With a leasing velocity of nearly 700,000-square-feet in 2017, Newark is quickly becoming an attractive destination for businesses throughout the region and beyond.

But unlike other busy urban centers coveted by new businesses, Newark has the space available for interested companies. In fact, 2 Gateway has an unheard of 200,000-square-feet available in their Class A building, perfect for any company looking for a large amount of space, and just one stop away from Midtown, Manhattan.

Not only is Newark emerging as an ideal location at the right price, but it is also uniquely positioned to handle all of the technological needs for companies, large and small, at an affordable cost. The city happens to sit directly above the fiber optic cable network that runs along the eastern seaboard, which allows companies to tap into the fastest internet speeds in the country at an extraordinarily competitive price point. The city took advantage of this network to create Newark Fiber, a program offering the highest-speed fiber for Newark buildings at the lowest cost in the region for comparable connections. 2 Gateway was the first building to tap into Newark Fiber, enabling C&K Properties to offer the connections a la carte to its tenants. This trendsetting nature isn’t foreign to 2 Gateway; in 2014, it became first building in New Jersey to become Wired Certified Platinum by WiredScore, indicating the highest rating for a building’s internet connectivity and technological infrastructure.

When it comes to location, cost and connectivity, Newark is in prime position to strengthen its standing as a regional business powerhouse, with or without Amazon.

Source: commercial