WeWork to open large coworking space near TechTown

Coworking giant WeWork, which already operates two spaces in downtown Detroit, will open up a third on Cass Avenue in TechTown. The new location will more than double its footprint in the city.

Crain’s Detroit Business reports that WeWork will lease 91,000 square feet of space in the building at 6001 Cass Avenue at York Street, which is owned by developer The Platform. It will occupy part of the first floor, and all of floors two through five.

WeWork also leases four floors at 1001 Woodward Avenue and seven floors at 1449 Woodward Avenue totaling 85,000 square feet. Both downtown buildings are owned by Dan Gilbert.

WeWork declined to comment to Crain’s about the news, and it’s uncertain when the office will open. At its other Detroit locations, a basic floating desk membership plan starts at $300.

The Albert Kahn–designed building at Cass Avenue opened in 1927 as the Cadillac Sales and Service Building. It later housed WSU’s Criminal Justice department, but had been vacant for some years before being purchased by The Platform in 2016 for $2 million.

View from the intersection of the corner of a square, six-story limestone building. Two red “For Lease” signs hang on the side.
6001 Cass Avenue Google Street View
Other tenants in the approximately 130,000-square-foot building include Novi-based Tata Technologies and a Wayne State University art gallery. It’s slated to open this fall.

Before being put on hold earlier this year, The Platform had been working on a nearby, large-scale development plan called Cass & York that called for luxury condos.

WeWork made headlines in August before its initial public offering after releasing its S-1 filing which showed it was losing nearly $2 billion annually. The company operates more than 525 locations in more than 110 cities worldwide.

Co-working spaces spawn growing businesses

January 20, 2019

Crain’s Detroit Business

Marti Banedetti

As Detroit’s office-sharing, co-working businesses such as WeWork grow, so are the businesses occupying their office space.

Take Bloomscape Inc., an online plant company started last March in WeWork’s first downtown Detroit co-working space. Bloomscape CEO Justin Mast founded the company with one employee in a small WeWork office and now has 11 employees in considerably larger quarters.

WeWork measures its success by how full its office space is but does not disclose the occupancy rates of its properties, said a WeWork spokesperson who asked not to be named. Bloomscape is in WeWork’s first downtown Detroit location in the Merchants Row building on Woodward Avenue and Clifford Street.

WeWork opened that office in 2017, and it includes seven floors. The second location, which opened later in 2017, consists of four floors in the 1001 Woodward office tower overlooking Campus Martius. The entire fourth floor is occupied by Accenture.

A handful of WeWork’s Detroit tenants agreed that they and their fellow businesses appreciate the ability to work separately together and to expand office space as needed.

Today’s co-working spaces such as WeWork are brimming with millennials who want and expect plenty of creature comforts with their workday. Per WeWork’s 2018 Economic Impact report, nearly half of its U.S. members are between the ages of 25 and 34.

The company’s two Detroit locations offer “members” comfy phone booths for private conversations — or a nap; Fruit Water on each of the floors (think pineapple and lemon); couches with pillows and blankets; and nooks for relaxing chats.

What looks like a mini-convenience store along one wall is called the Honesty Market.

Here members can choose from a variety of healthy chips and Kind bars or less healthy Starbursts or Snickers. Members have their form of payment connected to their WeWork mobile app.

Displayed in the company’s elevators are the week’s daily beer offerings (local craft, of course) and activities, such as decorating a pumpkin while enjoying cider and doughnuts (during the Halloween season).

Tenants have their choice of posh-looking glass offices in every configuration to accommodate one person or more than a dozen. If they only need a short stint at the Detroit office or any of WeWork’s offices across the globe, they can rent a “hot desk” — basically a chair at a table — for $280 a month.

Other rates start at $380 a month for a dedicated desk that no one else uses, $560 a month for a one-seat private office, $4,690 a month for a 10-seat office, and rising from there.

WeWork was founded in 2010 in New York City by Adam Neumann and Miguel McKelvey. Its growth trajectory has been rocket-like. Less than a decade later, the company has 400,000 members in more than 400 locations in 26 countries in 99 cities. Its members are entrepreneurs, freelancers and small businesses, but they also serve mid-sized and Fortune 500 companies.

The company made news last week with the announcement that it plans to reorganize into three units — one each focused on co-working space, residential space and educational businesses — and rebranding the parent company as the We Co.

We Co. has spent lavishly to finance its fast growth — to the tune of losing $1.2 billion in the first three quarters of 2018.

Detroit presence

In the Bedrock Detroit-owned, restored buildings, a few of the Wework offices house automotive suppliers, and even Ford Motor Co. has a tiny office occupied by the only gray-haired worker spotted in the building.

“A characteristic of Detroit’s WeWork community is a higher concentration of auto businesses,” said Kyle Steiner, WeWork Detroit community director. “And while the Detroit offices are dog friendly, our members hardly ever bring in dogs. Denver, on the other hand, has a strong dog culture, so its WeWork offices are full of dogs.”

Another difference: Beer is a crowd-pleaser in Detroit. “The Denver lifestyle, for example, prefers Kombucha over beer,” Steiner said.

His job “makes sure the offices have the pulse of the city and through the engagement of the team we can grow in Detroit,” he said. The offices’ activities also help bring fellow entrepreneurs together either for networking or friendship.

Blooming growth

“The flexibility and amenities here make it an easy place to be. I can focus on growing the business,” said Bloomscape’s Mast.

“Bloomscape is indicative of what can happen in these offices,” Steiner added.

Bloomscape has its greenhouse in Grand Rapids, where Mast grew up and several generations of his family were commercial growers. But when it came to locating the company office, Mast wanted to be in “downtown Detroit with all the energy that is there. We also felt that being here would give us access to resources outside of the city.”

Mast makes no bones about enjoying the WeWork amenities — “the micro-brewed coffee, the phone booths, the windows,” he said.

Ryan Landau, Re:purpose founder, started his hiring platform for technology companies a couple of years ago. He was among the first companies to launch in the Detroit WeWork space. He has eight employees: Half are in Michigan and the other half are in other parts of the United States. All work at WeWork “hot desks.”

“It’s not distracting to work in the open. If you need privacy, you reserve a conference room or a telephone booth,” Landau said.

Re:purpose also benefits by networking with other companies in the WeWork office. He has helped some companies find vetted employees and has found positions for those seeking new employment. Landau said the WeWork Detroit location nicely showcases the city to job candidates. Thirty percent come from cities outside Michigan and 70 percent hail from cities in the state. “It’s an exciting time when we pull people (to Detroit) from cities like San Francisco.”

Derek Rafferty of E3 Detroit sits in the WeWork common area on the eighth floor.

E3 Detroit, an entertainment and events company founded by Derek Rafferty, has a tiny but stylish, glass-enclosed WeWork office. He has an assistant down the hall.

He moved into his WeWork office because he wanted out of an industrial park in Canton Township. “There was no interaction with our industry and the venues our bands play in,” he said. E3 Detroit books bands for weddings and other events.

“Our growth could get us to four employees,” Rafferty said. “So, there is no reason to leave the WeWork space based on how our business is structured. And I love the vibe that is going on in Detroit.”

He said networking and talking with other WeWork members about their businesses is useful. “And I’ve made some new friends.”

Devon O’Reilly, manager of entrepreneurship at the Detroit Regional Chamber, is the face for people working in the Planet M Landing Zone, which occupies WeWork’s fourth floor and is specifically designed for mobility startups. It moved into WeWork in October 2017.

“We engage members on other floors and connect through the meet and greets. It’s very collaborative,” O’Reilly said.

Finding distinctiveness

WeWork came later to the co-working genre in Detroit than some of its competitors. Five years ago, Bamboo Detroit was the first co-working space to open downtown, and almost two years ago, it moved into the Julian C. Madison Building on Washington Boulevard.

“We’ve tried to evolve our own brand,” Bamboo Detroit co-founder and CEO Amanda Lewan said, adding that tenants are privy to coffee, tea, snacks, high-speed internet, printing, unlimited access to conference rooms, and other perks comparable to WeWork.

Overall, it keeps its prices lower to be an affordable model for startups, nonprofits and other diverse operations and “to do a good job of being a diverse community. Sixty-five percent of the companies here are women-owned,” Lewan said.

Steiner added that WeWork keeps in touch with other co-working companies such as Bamboo Detroit. “Co-working is a bigger concept than it used to be. Every one (of these businesses) is doing well and believes this industry is growing.”

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PlanetM Landing Zone Launches in Detroit, Will Draw Mobility and High-Tech Startups to the Region

In an effort to attract and connect more mobility-focused startups and other emerging high-tech, automotive-focused companies to the region, the Detroit Regional Chamber, Michigan Economic Development Corp. (MEDC) and WeWork launched the PlanetM Landing Zone in Detroit last week.

This first-of-its-kind space will serve as an environment where startups with autonomous, connected, electric and shared transportation technologies can connect with Detroit’s automotive and economic development network. This initiative will be housed at WeWork’s Merchant’s Row shared workspace location in Detroit. The PlanetM Landing Zone will occupy 40 to 50 workspaces with room for about 20 companies in the first year of operation.

Selected companies will have access to WeWork locations globally and a direct connection to the MEDC through its PlanetM and Pure Michigan Business Connect program, which helps connect local and global purchasers to suppliers of Michigan goods and services. Additionally, the Chamber will house staff members on-site who will provide services to these firms, that can help connect them to and grow more quickly in the market.

The PlanetM Landing Zone is the region’s latest tool to foster innovative technology development and talent growth, key focus areas of Forward Detroit. Creating a welcoming environment and platform for mobility entrepreneurs to establish a presence in the Detroit region is also a 2017 Mackinac Policy Conference To-Do item.

“Our region must be overly competitive in next-generation mobility. To complete this ecosystem, we need to attract more tech pioneers and entrepreneurs to our region,” said Sandy Baruah, president and CEO for the Chamber.

Ford Motor Co. is the first automaker to join the partnership, while :DriveSmart, Spatial, SPLT and Sherpa Capital are currently tenants. Read coverage of the PlanetM Landing Zone opening in Crain’s Detroit Business, DBusiness and The Detroit News.

New Workspace to Draw Mobility and High-Tech Auto Startups to Downtown Detroit

In an effort to attract and connect more mobility-focused startups and other emerging high-tech, automotive-focused companies, the Detroit Regional Chamber, Michigan Economic Development Corp. (MEDC) and WeWork announced today the launch of the PlanetM Landing Zone. This first-of-its-kind space will serve as an environment where startups with connected and automated transportation technologies can connect with Detroit’s automotive and economic development network. Ford Motor Co. is the first automaker to join the partnership via its City Solutions team located on-site.

This initiative will be housed at WeWork’s Merchant’s Row location in Detroit. Located at 1449 Woodward Ave., it is part of a global shared workspace company with more than 160 locations in 52 cities and 16 countries. The PlanetM Landing Zone will occupy 40 to 50 workspaces with room to about 20 companies in the first year of operation. Currently, :DriveSmart, Spatial, SPLT and Sherpa Capital are tenants.

Selected companies will have access to WeWork locations globally and a direct connection to the MEDC through its PlanetM and Pure Michigan Business Connect program, which helps connect local and global purchasers to suppliers of Michigan goods and services. The Chamber will house staff members on-site who will provide services to these firms, that can help connect them to and grow more quickly in the market. Additionally, the PlanetM Landing Zone will provide connections to key automotive industry and service providers.

“Our region must be overly competitive in next generation mobility. To complete this ecosystem, we need to attract more tech pioneers and entrepreneurs to our region,” said Sandy Baruah, president and CEO for the Chamber.

The need for a soft landing zone became more obvious after recent fact-finding missions to high-tech markets active in the automobility space like Silicon Valley, Israel and the Netherlands. Early-stage firms in these markets are eager to access the North American automotive industry that is centered in Detroit, but they need assistance with not only identifying workspace but also connecting to partners, customers, advisors, economic development services and capital. The PlanetM Landing Zone will be a key hub to cultivate and deliver these services.

“The goal is to create a center of gravity for emerging automotive technology companies with the ultimate objective of drawing these firms into the community on a permanent basis. MEDC’s PlanetM program is predicated on customer service, and this concept allows us to provide that in a meaningful way, right away,” said Jeff Mason, CEO for MEDC.

“We are excited to work with the MEDC and the Detroit Regional Chamber to launch this initiative and support mobility-focused startups in Detroit. These companies are innovating in the industry that the Motor City has fostered from the beginning. In addition to continuing to work closely with the city’s startup, business and civic leaders to drive Detroit forward, WeWork is excited that this initiative will further establish Detroit as a thriving community for creators,” said Megan Dodds, Midwest community director for WeWork.

“SPLT is thankful to the MEDC and Detroit Regional Chamber teams for making the space for mobility innovators to work, co-create and excel together. The PlanetM Landing Zone has given our team the room to grow,” said Anya Babbitt, CEO and founder of SPLT. “We are certain that this place will be the cornerstone to the larger movement in new mobility technologies and the future of Detroit. First Techstars, now the PlanetM Landing Zone. We can’t wait to continue our journey in Michigan and beyond.”

“The landing zone fills an unmet need in our ecosystem, supports business attraction efforts, and is a major step toward driving density of activity. We look forward to increased collaboration with the state and regional partners to position Detroit and Michigan as the premier destination for high-growth companies,” said Aaron Turk, senior executive of strategy and business development for the Detroit Economic Growth Corporation.

The ideal company for the PlanetM Landing Zone is a startup, either domestic or international, interested in bringing connected or automated technology into the North American automotive ecosystem. To learn more, visit www.planetmlandingzone.com.

About the Detroit Regional Chamber

The Detroit Regional Chamber’s mission of powering the economy for Southeast Michigan is carried out through economic development, education reform, regional collaboration and providing valuable benefits to members. For more information, please visit www.detroitchamber.com.

About PlanetM

PlanetM represents Michigan’s unique and vast ecosystem, connecting resources and opportunities for its consortium of members. Made up of private industry, government and institutions of higher learning, participants in PlanetM share the common goal of leading the development of smart solutions that will change the way people and goods are transported across all modes of transportation. To learn more about how Michigan is leading the transportation revolution or to become a member, visit www.planetm.com.

About WeWork

WeWork is the platform for creators. We provide beautiful workspace, an inspiring community, and meaningful business services to hundreds of thousands of members around the world. From startups and freelancers to small businesses and large corporations, our community is united by a desire for our members to create meaningful work and lead meaningful lives—to be a part of something greater than ourselves. Co-founded by Adam Neumann and Miguel McKelvey in New York City in 2010, WeWork is a privately held company with over 2,000 employees.

About Ford Motor Company

Ford Motor Company is a global company based in Dearborn, Michigan. The company designs, manufactures, markets and services a full line of Ford cars, trucks, SUVs, electrified vehicles and Lincoln luxury vehicles, provides financial services through Ford Motor Credit Company and is pursuing leadership positions in electrification, autonomous vehicles and mobility solutions. Ford employs approximately 203,000 people worldwide. For more information regarding Ford, its products and Ford Motor Credit Company, please visit www.corporate.ford.com.