Connecteam inks $117 million office deal

Talk of working from home during the coronavirus (Covid-19) pandemic has been replaced by panic in the high-tech sector to acquire real estate. Companies are leasing entire office buildings or additional locations, and many are complaining over the difficulty in locating vacant spaces.

Calcalist has learned that startup Connecteam plans to lease 11,500 square meters of office space for NIS 375 million ($117 million) for the next 15 years as part of the Canada Israel and Acro Real Estate Da Vinci residential building project in Tel Aviv.

Currently, the company employs only 100 people, but plans on recruiting an additional 200. The company may lease some of the space for a year or retain them to enable quick company expansion. The building is currently under construction, and Connecteam plans to enter the space in 2023.

Connecteam’s offices will stretch across a 9,000 square meter space covering two floors, including a 2,500 square foot penthouse equipped with a balcony. The startup’s investment in renovation is expected to stand at around NIS 55 million ($17 million).

Connecteam was founded in 2015. Last April, it raised $37 million led by Insight Partners and O.G. Tech, Israeli entrepreneur Eyal Ofer’s investment fund, and by some Wix founders, including COO Avishay Abrahami, who also invested in the company previously. So far, the company has raised a total of $40 million. It was founded by CEO Amir Nehemia, Lirit Shmueli, Hadar Shmueli, and Matan Elmalam. The Shmueli duo left the company four years ago and currently the company is led by Nehemia, Daniel Nuriel and Yonatan Nuriel.

Connecteam develops a mobile business optimization service designed to help businesses create their own mobile apps for managing their staff. The company's system integrates with an online platform to create mobile training manuals, establish communication between management teams and employees, and assist executives with the monitoring and management of their remote employees. Available features that can be added to the app include an employee time clock, scheduling tools, and employee training manuals.

It has 1,000 customers in Israel and North America, among them SodaStream, Tnuva, Isrotel Hotel Management Ltd., FOX, Afikim Public Transportation, Shikun & Binui, Sodexo, Nike, and more.

The Da Vinci project is located on the corner of Kaplan and Da Vinci streets, and overlooks the Sarona park. It was designed by architect Avner Yashar. The project is composed of two residential buildings, 35,000 square meters of office space, and a 1,000 square meter shopping center.

Canada Israel’s Head of Yielding Assets Omer Levy related that “demand for office space in central Israel, particularly Tel Aviv, is exceeding supply. Forecasts that this market would shrink were too early. Large companies, mainly those in high tech, understand that working from home cannot replace working from the office, and that this trend will continue.”