Cue - Co-working Made Easy

September 22, 2022

About 18 months ago, we were asked by Quadrant Investment Properties to take over the operation of a struggling co-working operation in one of their office buildings in downtown Dallas, TX. It was something we had never done before, and we thought it would be a challenge worth taking on. More importantly we thought the co-working project would be a great way to test new Honeycomb product features within a closed environment.

With a starting occupancy of just 14%, an unhappy tenant base and a neglected space we knew we had to act fast.

The order of operations upon take over was the following:

  • Rebrand the space - we chose Cue as the brand and had all of the signage replaced and built a new website with a very simple messaging
  • Marketing - Cancelled the digital marketing company contract ($5,000/month) and developed a highly targeted campaign using Google Maps as our keystone
  • Personnel - Cut staff to one as we believed Honeycomb would alleviate most of the operational burden of the space
  • Enhanced the workspace - created a 12 month plan to make strategic upgrades to the space
  • Re-engineered pricing and focused on quickly building a community of people rather than just cash flow
  • Deployed Honeycomb as the operating system for user management, communications, amenity management, access control, parking and payment collection

After completing the above - we waited and just worked to make the space feel alive by initiating a communication and events schedule for the space and entire building. Slowly we saw the transition start to happen. The mood of the tenants started to improve, we saw inbound inquires in crease dramatically over the first six months and the space started to fill.

The results after 18 months, speak for themselves:

  • Occupancy increased from 12% to 74% with one large space left to lease
  • The weighted average lease term is currently hovering around eight months
  • There is 0% delinquency and the average rent increase on renewal is 29%
  • The space is set to contribute ~$29,000/month (net of expenses) to the building's NOI or $27/usi annually. We expect that to increase to $31/usi over the next twelve months

Based on our performance, the building has signed a management agreement with Honeycomb to fully run the co-working operations going forward. If you are interested in creating a flexible office workplace or a co-working solution for your commercial real estate building, please do not hesitate to reach out.

#smartbuildings #proptech #coworking

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