WeWork to Acquire Common Desk

Meeting room. Image by MagicDesk via Pixabay.com

Months after going public, coworking giant WeWork is taking another step in its strategic growth with plans to acquire Common Desk, a Dallas-based flexible workspace provider that operates in Texas and North Carolina.

Terms of the deal were not announced but the acquisition is expected to close in March. At that time, Common Desk will operate as Common Desk, a WeWork Company.

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Founded by CEO Nick Clark in 2012, Common Desk serves 4,000 customers at 23 locations in 13 cities in Texas and North Carolina. Texas locations include multiple sites in the Dallas-Fort Worth area, as well as several in Houston and two in Austin. North Carolina sites are in Raleigh and Wilmington. Common Desk has grown through strategic management agreements with landlords that have enabled the company to perform at strong margins by minimizing capital expenditures. Within Common Desk’s current portfolio, 19 of its 23 locations are operated under management agreements.

Member-focused hospitality

Common Desk has become one of the country’s premier boutique flex space providers and is a strong brand known for the design of its spaces and member experience. Both WeWork and Common Desk stress creating communities through member-focused hospitality.

WeWork CEO Sandeep Mathrani, a commercial real estate veteran and former Brookfield Properties retail executive who took the top job at WeWork in February 2020, said in a prepared statement Common Desk’s operational expertise and first-class portfolio will further bolster WeWork’s value proposition as it focuses on strategic growth. Mathrani said WeWork seeks partners that are most aligned with the coworking company’s priorities and Common Desk presented itself as a sophisticated operator with a compelling approach to providing member experience without sacrificing strong margins or its product.

First Acquisition

In addition to being WeWork’s first acquisition since it went public in October via a $9 billion merger with special purpose acquisition company BowX Acquisition, it’s also the first purchase of a company since Mathrani became CEO. However, WeWork formed a strategic partnership with Cushman & Wakefield which made a $150 million investment in WeWork that was announced in late October. The investment followed the announcement of an exclusive strategic partnership in August that would provide clients with best-in-class office operations by combining WeWork’s proprietary hospitality and technology-enabled services with Cushman & Wakefield’s asset and facilities management services. The initiatives were expected to help the partnership grow WeWork’s landlord and tenant-focused offerings.

For Common Desk, being acquired by WeWork, which has become one of the leading global providers of flexible office space since its founding in 2010, will enable it to leverage WeWork’s experience in member services, Clark said in prepared remarks. With the added support of WeWork and its client roster, Common Desk will be able to improve the experience of its own members and continue to build out its member base, Clark stated.