Convene Launches New Product To Design, Build Flexible Workspaces For Class-A Office Landlords
Convene, a workplace solutions provider, is branching out from its traditional model to meet the growing demand of office owners looking for flexible workspaces while maintaining their company brands.
Convene CEO and co-founder Ryan Simonetti told Bisnow that the company is launching a new turnkey solution Monday for Class-A office landlords and building owners that allows Convene to help them design, build and/or manage flexible work and amenity spaces.
Simonetti described the company’s managed workplace and amenity solution as a product that delivers not just flexible workspace but also amenities and services on behalf of building owners and does it in a way that is co-branded.
“This is endorsed and powered by us but it can be independently branded by the business owner,” he said.
That model remains in place, but Convene's new offering gives the company another service to offer building owners and landlords.
“We can sign a lease and build a Convene,” Simonetti said. “Or we can partner with you with our managed workplace offering and it can actually be branded to you in the building."
Under the leasing model, Convene collects rent from tenants who use the space, but the new offering would allow most of the profits to go to the building owner.
Simonetti said the benefit of that is “you have more control over the space, the design, the branding. You can control how much space we take or don’t take and we’ll do that in partnership with you and you get to control the bulk of the economics in that deal.”
Simonetti said this product can be rapidly deployed and scaled through a landlord’s portfolio. The new service allows Convene more business opportunities with other Class-A landlords and owners than its traditional approach.
Convene’s announcement comes as the company continues to grow its workplace solutions empire at a rapid pace.
Last month, the company raised a $152M Series D round led by Arrowmark. RXR Realty, Revolution Growth and The Durst Organization were among several investors that are investing in the company.
In May, Convene purchased Boston-based data and analytics company Beco, which tracks workplace activity.
Earlier this year, Convene opened its newest locations at Brookfield’s Wells Fargo Center and 777 Tower in downtown Los Angeles. It was the company’s first foray on the West Coast. Convene's partnership with Brookfield means the company will eventually design, operate and program space in buildings across Brookfield's portfolio.
The company has plans to continue to expand beyond its current 20 locations and with this new service offering, provide more workplace solutions.
Within the past five years or so there has been a groundswell of building owners wanting to build flexible workplaces or amenity-rich buildings to retain and attract the new generation of office tenants and workers.
At a recent Bisnow event, commercial real estate office experts said more building owners are providing amenities, including fitness centers, lounges, courtyards and concierge services.
Buildings with flexible workspace account for less than 5% of office inventory worldwide, JLL reports. But this trend could rise to 30% “due to insatiable levels of tenant demand for flexible-term spaces,” according to a 2017 JLL report.
“As tenants across industries grapple with managing an increasingly fluid workforce — consisting of telecommuters, freelancers and contract employees — accommodating digital talent is taking on heightened importance,” the report states. “Companies both large and small have begun to realize the potential of leveraging flexible space arrangements to better manage their liquid workforce.”
Simonetti said Convene came up with this product because many of its partner landlords wanted more control beyond the normal Convene space and wanted to jump on the growing trend so they could begin building their company brand.
“We’re giving the power back to the building owner and to the landlord so they continue to maintain the strategic relationships with their tenants and enterprise customers,” Simonetti said. “We are just a catalyst and conduit for that.”