It’s time to share a conference room in the City of Brotherly Love.
CBRE’s first co-working location in the Northeast is set to open by the end of the year in Philadelphia.
The 50,000-square-foot location at Shorenstein Properties’ 1818 Market building is under CBRE’s Hana brand that the commercial giant launched last year, according to the Philadelphia Inquirer. CBRE has opened two Hana locations — in London and Dallas — and plans to open two others in Irvine, California and Arlington, Virginia.
Hana will offer most of the same services to users offered by co-working brands that have built the model, like Knotel and WeWork. Those companies typically lease space from a landlord at a monthly rate and then sublease that space out to its users at a premium.
Hana will not sublease — the landlord retains control of the space and Hana manage and brand it for a fee, giving the landlord a share of profits from subleasing.
That could be an attractive arrangement for landlords, particularly as demand grows for co-working-style spaces among traditional large office tenants. Hana CEO Andrew Kupiec said that arrangement “a more secure, overall more transparent model.”
CBRE’s venture into co-working hasn’t necessarily gone over well with its competitors. Knotel CEO Amol Sarva, whose firm just announced layoffs in New York, said last year that it would no longer work with CBRE. Bond Collective CEO Shlomo Silber called Hana a “conflict of interest” for the brokerage.
WeWork leases 1.3 million square feet in Philadelphia and is Hana’s biggest competition there.
Kupiec said that Hana wants to expand to other Shorenstein-owned buildings in the future. [Philadelphia Enquirer]