Israeli shared-office space provider Mindspace has secured $72 million to help fuel its expansion in Europe, the United States and its home country.
The fundraising round was led by Harel Insurance Investment and Financial Services to help Mindspace, which manages 1 million square feet of office space in 32 branches across 17 cities and seven countries, continue to expand during a difficult time in the commercial real estate market when it added new locations in London, Tel Aviv and Philadelphia.
“Mindspace is experiencing an impressive growth momentum and high demand in all its locations,” said Dan Zakai, the company CEO who co-founded it with Yotam Alroy. “We successfully faced the many challenges of COVID. Today, our locations are almost at full occupancy and the current investment led by Harel Insurance and More Provident Funds is intended to fulfill the rising demand in the market and to launch new locations in partnership with landlords worldwide.”
Mindspace provides offices with amenities such as lounges, fully equipped kitchens and meeting rooms, the company said. It claims to have 95 percent occupancy in Israel and Germany while keeping its pre-pandemic pricing in place.
The company has signed six management agreements in the last two years, creating partnerships inspired by the hotel industry that it says allows greater flexibility and profitability for the landlord in today’s tough market.
Harel invested $30 million, and Sami Babkov, said it was money well spent.
“This investment is an expression of confidence in the flexible workspace model,” he said in a press release in which he claimed the move showed “confidence in Mindspace’s experienced and professional management team.”
Ori Keren, CIO at More Provident Funds, which also contributed funds along with Shalom Meckenzie, Arkin Holdings and other existing investors, concurred.
“In a short time, the company managed to create new standards in the market, to build high loyalty among its customers and is experiencing steady growth,” he said.
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