IWG, Instant Group creating flex office space giant

WeWork rival investing $350M into online marketplace venture

New York /
Mar.March 15, 2022 10:15 AM

Tim Rodber, chief executive officer, Instant Group (Instant Group, iStock)

A flex office operator is poised to seize on rising interest in alternative office arrangements with a deal establishing the dominant player in the online listing marketplace.

IWG is investing about $350 million into the venture with office listing service Instant Group. The Wall Street Journal reported the two companies are aiming to create the world’s largest online marketplace for flexible office space.

The new venture will allow tenants to find and book spaces, including offices managed by the likes of IWG and WeWork, hotel meeting rooms and vacant corporate office space. The Journal reported that under the deal merging IWG’s digital offerings with the Instant Group, the Switzerland-based firm is set to own 85 percent of the business, while Instant management will own the remaining 15 percent.

A big portion of IWG’s investment in the business was used to buy out Bowmark Capital, the private equity firm behind Instant Group. The companies plan to take the business public within the next two year; Instant Group CEO Tim Rodber will helm the online marketplace business, which will also offer software to aid companies managing remote workers.

Demand for flexible office space and hybrid work arrangements are on the rise since the onset of the pandemic. A survey by JLL found 41 percent of office tenants expected to increase use of flexible office space due to the pandemic, which the Journal noted as a rise from 29 percent recorded in a 2020 survey.

IWG CEO Mark Dixon told the Journal he believes the swell of interest means the timing is right for the online venture.

“Many have tried, but here we start off with a very strong position at the right time in the market, we believe,” Dixon said, according to the Journal.

IWG has previously shown its confidence in the flexible office market with new locations opened last year in New York. The company had plans for three new hubs in the city last year, including a 58,000-square-foot space at 250 Park Avenue.

Meanwhile, the most well-known player in the flexible office space, WeWork, saw its losses narrow in the fourth quarter and its revenue climbed by more than $50 million. The company expects $4 billion in revenue in 2022.

[WSJ] — Holden Walter-Warner





    Related Articles

    arrow_forward_ios
    Vorea Principal's Peter Papamichael with 10-04 Borden Ave (Vorea Group, iStock)
    Skydiver lands first NYC location in Long Island City
    Skydiver lands first NYC location in Long Island City
    Two Trees Management's Jed Walentas and 50 West 23rd Street (Walentas/via Marc Skrivo, Google Maps, iStock)
    Trustpilot takes 34k sf at Two Trees’ Midtown South building
    Trustpilot takes 34k sf at Two Trees’ Midtown South building
    Bruce Brickman and 35-11 9th Street (Young Jewish Professionals, Google Maps)
    Astoria cigar factory converted to offices highlighted NYC i-sales last week
    Astoria cigar factory converted to offices highlighted NYC i-sales last week
    BlackRock's Larry Fink, with 98 Riverside Drive (BlackRock)
    BlackRock sells stabilized UWS rental for $90M after landmark designation
    BlackRock sells stabilized UWS rental for $90M after landmark designation
    Eli Elefant and 452 5th Avenue (IAVA, Property Building Corp)
    PBC nears $385M loan for HSBC tower after sale to Innovo collapses
    PBC nears $385M loan for HSBC tower after sale to Innovo collapses
    Vornado CEO Steven Roth and One Penn Plaza (Vornado Realty Trust)
    Health insurer takes 70k sf for HQ in Vornado’s One Penn Plaza
    Health insurer takes 70k sf for HQ in Vornado’s One Penn Plaza
    From left: Scott Rechler and 5 Times Square; Marc Holliday, Steven Roth and 280 Park Avenue (Getty Images, Eden, Janine and Jim from New York City - via Wikimedia Commons)
    Swell of maturing debt pressures office owners
    Swell of maturing debt pressures office owners
    (photos by Joe Lovinger/The Real Deal)
    Day 2 of ICSC: Retailers button up to network, prep for uncertain future
    Day 2 of ICSC: Retailers button up to network, prep for uncertain future
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...