Industrious Taking Over 53K SF WeWork Space In Newport Beach
Flex office company Industrious is moving into a Newport Beach space vacated by WeWork. The move comes as the company has laid out larger plans to take over 1M SF of space across the country that its competitors have left behind.
The roughly 53.5K SF space at Granite Properties’ 100 Bayview opened as a WeWork in October 2019, just a month after the company’s first attempt to go public sputtered. At the time, it was the sixth Orange County location for WeWork, which exited the space in February, Granite Properties confirmed.
This is Industrious’ second location at a Granite Properties complex. Its first, at 500 North Brand Blvd. in Glendale, opened in 2018.
“We’re a believer in the demand for flex office in the future,” Granite Properties Senior Managing Partner Jason Purvis said.
The partnership between Granite and Industrious is part of a larger program from Granite known as evolve, which allows Granite to offer both traditional, longer-term lease office space and flex office to its customers without having to become a flex office provider itself, Purvis said.
Through a subscription-based membership feature of the program, Granite Southern California customers can use Industrious locations nationwide. The program, a pilot, is focused in Southern California right now. Granite has a similar pilot in Dallas with flex office provider Common Desk.
In both Glendale and Newport Beach, Industrious has signed management agreements with the company, Purvis said. These agreements differ from traditional leases in that Industrious operates the space and shares revenue from it with the property owner.
Four years ago, Industrious pivoted exclusively to these arrangements, Industrious President and co-founder Justin Stewart previously told Bisnow. The company expects to close up to 150K SF at locations nationwide where it can't convert its leases to management agreements. One of those locations is also in Orange County: 20K SF in Costa Mesa at 3420 Bristol St.
WeWork locations in Los Angeles and Orange County have been slowly shuttering at the same time as the company prepares to go public via a special-purpose acquisition company backed by Starwood Capital.
In Los Angeles, the latest WeWork to close was a 48K SF space at 925 North La Brea Ave. — roughly 75% of the building — where the company had signed a lease until 2029, Commercial Observer reported.
A WeWork spokesperson said that “with an abundance of supply in the market,” the company is in the process of rightsizing its footprint in LA and Orange counties, but the spokesperson didn't comment further on which Los Angeles or Orange County locations would be closing.
Other flex office operators have struggled over the last year. Breather filed for Chapter 11 bankruptcy in December and closed its more than 300 U.S. locations. New York-based Knotel, which grew quickly in LA, filed for bankruptcy in February and is set to be taken over by Newmark.