District-based flexible space provider cove has reached a deal to offer its suite of services and amenities to tenants at two Rockville office properties in exchange for a piece of the increased revenue it helps generate.
Companies renting space at Rubenstein Partners’ 2600 Tower Oaks Boulevard and the Research Plaza complex at 1445-1455 Research Blvd. will have access to the amenities cove offers members of its own physical coworking spaces and headquarters locations, with services ranging from stocked kitchen pantries and copy paper to IT and video conferencing. Tenants will also be able to use an app on their smartphones to access other shared amenities and perks like reserving meeting rooms and ordering coffee for delivery.
Terms of the partnership were not disclosed, but it is similar to a deal cove struck with The Meridian Group at its One Ballston Plaza building in Arlington. In both cases, cove was brought in on behalf of landlords to provide tenant services and amenities — rather than leasing space from them. It’s a concept some traditional landlords are embracing as they seek to compete with alternate space options like coworking and spec suites.
“Tenants are looking for flexibility and technology and amenities and food, and so we’re just looking at not leasing spaces to individual people but doing that as well as offering flexibility in the buildings,” said Stephen Evans, regional director for Philadelphia-based Rubenstein’s D.C. region. “So rather than just lease a discrete floor to a coworking company, which we are doing in our portfolio, we’re also looking to create an opportunity for tenants to have a flexible workspace.”
Those services might not mean much now to the scores of office dwellers working remotely due to the coronavirus outbreak, but cove has also agreed to make its newly launched cove@Home program available to tenants in the Rubenstein buildings, giving them access to cove’s online services and web portal.
In some ways, it’s an outgrowth of the coworking space movement made popular by providers like WeWork — though that business model is now confronting its own challenges amid the outbreak since it’s easier for members to get out of a monthly membership than a long-term lease.
It was cove that initiated contact with Rubenstein, said Adam Segal, a cove co-founder and its CEO. It was working with a company that was on the hunt for space in suburban Maryland through coveHQ, an arrangement in which cove leases a block of space for a single company rather than accommodating multiple individuals or companies in one of its coworking spaces. That company ended up going elsewhere, but the conversation between cove and Rubenstein evolved into the Rockville partnership.
Rubenstein already planned a series of renovations to both buildings before cove came along, but it enlisted cove’s help to consider what additional amenities it might incorporate into Research Plaza and 2600 Tower Oaks Boulevard.
“We really dug in on their two Maryland assets to start, both Research Plaza and 2600 Tower Oaks, and asked: How can we really layer on a new experience from a full-building perspective,” Segal said, “not only to help define the building experience but also help define the in-suite experience.”
Evans and Segal declined to discuss the framework of the partnership except to say both benefit financially by keeping occupancy high and turnover low. If the arrangement is successful for Rubenstein in Rockville, the two may expand the platform to other buildings the company owns elsewhere in the D.C. region.
“The whole experience, regardless of whether we’re supporting you inside your office or not, it’s going to be beneficial to everyone in the building,” Segal said.