Quarters is out of cash, Convene’s revenue plunges

National /
Jan.January 25, 2021 08:00 AM

Spare a Quarter?

The music has stopped for German co-living brand Quarters, whose U.S. expansion is ending in bankruptcy.

Eight properties and two LLCs tied to the company filed for Chapter 7 bankruptcy, listing between $1 million and $5 million in combined liabilities and less than $500,000 assets.

Quarters is an offshoot of Berlin-based Medici Living Group, which was founded in 2012 and pitched itself as the “WeWork of co-living.” After raising $1.4 billion to add locations in Europe, Quarters raised $300 million to expand to the U.S. in early 2019. The company signs master leases and then operates co-living spaces.

As of 2019, Quarters was aiming to have 9,000 rooms globally but by last year it only had 5,000. It now claims to have 3,000 rooms with 95 percent occupancy.

Eight of the U.S. LLCs that filed for bankruptcy are located in New York City, Washington, D.C., Philadelphia and Chicago. Two locations had not yet started leasing, including 251 DeKalb Avenue in Brooklyn. Last year, Quarters’ was sued by its landlord at DeKalb for trying to terminate its 10-year lease. The case is ongoing.


“I want to seize the momentum. You don’t always get opportunities like this.”

— Mayor Francis Suarez on making Miami the next Big Tech mecca  

Who doesn’t have a SPAC?

One of New York’s biggest retail owners is shopping for proptech deals.

The Chera family’s Crown Acquisitions is raising $200 million for a blank-check firm, jumping into an increasingly crowded field. Blank-check firms, popular in the 1980s, made a comeback last year and there’s no sign the trend is going anywhere…

This week, Fifth Wall Ventures, which has backed VTS, Hippo and States Title, also launched a $250 million special purpose acquisition company, or SPAC. Tishman Speyer, CBRE, SoftBank and others have all launched SPACs over the past year. So far, Opendoor and Porch.com have gone public in SPAC deals, but more are on the horizon.


How badly does CoStar want CoreLogic?

For months, investors have been circling CoreLogic. But a deal may be getting closer.

CoStar Group and a group led by Warburg Pincus are the final bidders looking to acquire the data provider.

Last year, activist investors Cannae Holdings and Senator Investment Group tried to buy CoreLogic for $66 per share. The deal fell through when CoreLogic got a better offer, in the ballpark of $80 per share. CoStar has been interested for months, and was said to offer $77 to $83 per share, but talks reportedly stalled this past fall when CoStar balked at CoreLogic’s non-disclosure agreement.

Convene faces cold, hard numbers

Convene’s revenue plunged 66 percent in 2020, after the pandemic put the kibosh on the company’s in-person events.

The startup, which provides space for meetings and events, generated $42 million last year, down from $123.9 million in 2019. It is now planning for half of its business to migrate online, CEO Ryan Simonetti told Business Insider. Convene has developed custom software for remote events.

Since 2009, Convene has raised $410 million, including a $150 million credit line. Since March, it laid off 150 workers and furloughed 421 others. It now has 200 employees and 29 spaces.


STAT OF THE WEEK

$25%

Airbnb’s stock closed at $181 on Jan. 22, up from $144 on the day of its December IPO


Zillow squeezes revenue from rentals

Zillow is upping its fees for agents and will start charging them to post rental listings.

Starting Jan. 12, rental listings cost $9.99 per week. The move comes amid heightened competition for rental listings from the likes of Zumper, CoStar and Rent.com. In a statement, Zillow said fees for listings help improve data accuracy.

But there are likely other reasons. “They have a gazillion consumers looking at rentals on their site,” said Victor Lund, a partner at WAV Group, “They want to monetize that.”


Fabric turns dark stores into fulfillment centers

Last-mile fulfillment isn’t sexy. But one-hour delivery sure is.

Enter Fabric, a startup offering an on-demand supply chain for retailers. Founded in 2015 in Tel Aviv, Fabric is now based in New York City. With $136 million in funding, it partners with retailers to repurpose big-box stores or gyms to use as last-mile, “micro” fulfillment centers. Fabric’s centers are typically 10,000 to 15,000 square feet, compared to Amazon’s 800,000-square-foot centers.

“It’s a whole different approach to automation that allows you to shrink it down,” Steve Hornyak, chief commercial officer, told Business Insider. “Big-box guys don’t need the entire square footage that they have, so why not leverage that in order to do e-commerce and click-and-collect?”


Small bytes

? Notarize, the digital notary startup, hired private equity exec Larry D’Angelo as its first president and chief commercial officer.
? iBuyer Opendoor hired Noah Beddome, a former marine, as head of data security.
? Robert Reffkin, CEO of Compass, the SoftBank-backed brokerage, paid $16.35M for a NYC penthouse.
? Flexe, a marketplace to buy warehouses on demand, added $10M to a previously announced $70M Series C.
? Omnipresent raised $15.8M to help companies employ remote workers worldwide.
? eXp World Holdings — which owns digital brokerage eXp Realty — announced a 2-for-1 stock split. Shares closed at nearly $103 per share on Jan. 22.


 
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