REEF Technology raises $700M from SoftBank and others to remake parking lots
Original article by Jonathan Shieber, Tech Crunch,
It seems like SoftBank and the Mubadala Corp. aren’t finished taking big swings at the commercial real estate business in the U.S. Even after the collapse of WeWork, the investors are doubling down on a similar business model as part of a syndicate investing $700 million into REEF Technology.
REEF began its life as Miami-based ParkJockey, providing hardware, software and management services for parking lots. It has since expanded its vision while remaining true to its basic business model. While it still manages parking lots, it now adds infrastructure for cloud kitchens, healthcare clinics, logistics and last-mile delivery, and even old-school brick and mortar retail and experiential consumer spaces on top of those now-empty parking structures and spaces.
Like WeWork, REEF leases most of the real estate it operates and upgrades it before leasing it to other occupants (or using the spaces itself). Unlike WeWork, the business actually has a fair shot at working out — especially given business trends that have accelerated in response to the health and safety measures implemented to stop the spread of the COVID-19 pandemic.
In part that’s because REEF operates its own businesses on the premises and works with startups to provide actual goods and services that are location dependent for their success and revenue generating.
The money will be used to scale from its roughly 4,800 locations to 10,000 new locations around the country and to transform the parking lots into “neighborhood hubs,” according to Ari Ojalvo, the company’s co-founder and chief executive.
SoftBank and Mubadala are joining private equity and financial investment giants Oaktree, UBS Asset Management and the European venture capital firm Target Global in providing the cash for the massive equity financing. Meanwhile, REEF Technology and Oaktree are collaborating on a $300 million real estate investment vehicle, the Neighborhood Property Group,as Bloomberg reported on Monday.
In all, REEF, which could reasonably be described as a WeWork for the neighborhood store, has $1 billion in capital coming to build out what it calls a proximity-as-a-service platform.
Since taking a minority investment from SoftBank back in 2018 (an investment which reportedly valued the company at $1 billion) and transforming from ParkJockey into REEF Technology, the company added a booming cloud kitchen business to support the increase in virtual restaurant chains.
In addition, it added a number of service providers as partners,including last-mile delivery startup Bond (and the logistics giant, DHL); the national primary healthcare services clinic operator and technology developer, Carbon Health; the electric vehicle charging and maintenance provider, Get Charged; and — at its operations in London — the new vertical farm developer, Crate to Plate (Ojalvo said it was in talks with established vertical farming companies in the U.S. on potential partnerships).