Herman Miller’s Acquisition of Maars Living Walls Represents Latest Foray into Modular Walls Market

Seattle, Herman Miller, Maars Living Walls, Pivot Interiors, Catalyst Workplace Activation, modular construction, modular walls
Image courtesy of Herman Miller

By Jack Stubbs

“Modular design is something that Herman Miller has been involved in [since] the start of the company and several of our products over the course of our history; this is another evolution in that regard based on a strong foundation of how we’ve designed product historically,” said Katie Lane, vice president of Enclosures at furniture dealership Herman Miller.

Modular construction has been a growing sector in certain key U.S. markets, and Michigan-based Herman Miller—a globally-recognized provider of furnishings and related technologies—recently announced plans to continue its expansion into the world of modular construction.

In early June, the company announced that it was leading a group of investors to acquire Maars Living Walls (“Maars”), which is a global designer and manufacturer of customized modular wall solutions based in the Netherlands. Under the terms of a preliminary agreement, Herman Miller will acquire 48 percent of Maars equity for $6 million with an option to acquire a controlling interest over time. Additional investors in the group include select U.S. certified Herman Miller dealers, a European dealer and members of the Maars management team.

The acquisition of Maars will allow Herman Miller—a company founded in 1905—to add an important capability within the growing market of modular walls and will also enable more dealers and customers to interact with the company’s growing product portfolio. More broadly, the announcement made in early June came at a time when the modular walls market is on the rise, according to Lane. “The whole modular walls category has evolved… and is an area of growth in the U.S. right now. So it’s a real opportune time for us to have jumped into this,” she said.

Seattle, Herman Miller, Maars Living Walls, Pivot Interiors, Catalyst Workplace Activation, modular construction, modular walls
Image courtesy of Herman Miller

In the broader context, the acquisition of Maars Living Walls seemingly comes at the right time for all involved. Founded in 1946, Maars—which looks to provide innovative solutions for interior spaces including offices, airports, hospitality and universities—has since expanded to over 45 countries. “This acquisition strengthens our mission to improve people’s well-being and productivity by combining Maars Living Walls with the Living Office strategy of Herman Miller. Maars will have access to Herman Miller’s expansive and strong dealer network in North America and their global customer base,” said CEO of Maars Living Walls Menno de Vries in a statement at the time of the acquisition.

Another of the factors motivating Herman Miller’s recent acquisition of Maars is the continually evolving needs of the company’s clients. “With the open-plan environment truly becoming predominant with our customer base, it’s really driving the need for strategically-placed enclosures in the floor plan,” Lane said. “Our clients are looking to manage sound and visual privacy; they’re looking for different levels of performance in those areas…our customers are thinking about what different types of workers will need to be most effective in their jobs and where they’re traveling to throughout the day, going through group and team-collaboration spaces,” she added.

The increasing prevalence of modular construction in the world of interior design has been occurring over the last couple of years in particular—and is reflective of these evolving needs of clients, according to Ken Baugh, president and CEO of Bay Area-based Pivot Interiors, which is the exclusive Maars dealer in California. “We’ve been a Maars dealer for about a year and a half and have been in the modular construction business for longer than that. With Maars in particular, we’ve seen a very strong demand in the past couple years in terms of customers really looking for solutions that provide flexibility and acoustical properties,” Baugh said.

From the perspective of Pivot Interiors—a company founded in 1973 that looks to create and design unique workplace solutions for companies ranging in size from startups to Fortune 500s— the implementation of modular construction has been occurring across the board. “All of our major clients are utilizing modular wall solutions to one degree or another; largely in the technology sector here in the Bay Area but we’re also seeing it in healthcare, education and hospitality as well,” Baugh added. Pivot Interiors has offices and showrooms in Santa Clara, Fremont, San Francisco, Costa Mesa and Los Angeles.

Another of the investors in Maars, Seattle-based Catalyst Workplace Activation—a company that works with architecture and design teams and large corporations to create engaging spaces for people to work, learn and collaborate —saw the intersection with Maars as a unique prospect in the longer term. “We became an investor because it’s an exciting market that is full of growth opportunities. We’ve been in the architectural and demountable wall business for over fifteen years already. To be a partner and investor with Herman Miller on a globally manufactured, designed and distributed product was really a huge opportunity for us,” said Sean O’Brien, president and CEO of Catalyst.

Herman Miller-certified dealer Catalyst, who has regional locations in the Puget Sound market in Seattle, Tacoma and Tukwila, looked to capitalize on the demountable movable walls and acoustical features that Maars specializes in. “It takes awhile to get into the modular wall business, and we’ve proven that we can do some great work out there; our clients are asking us for more. Maars is considered to be the best in the acoustical space, better than any manufacturer of demountable wall product around the world,” O’Brien added.

More locally in the Bay Area, Baugh has seen an increasing interest in modular construction in the local market, which in recent years has been plagued by construction shortages and job-site inefficiencies—something that modular construction helps to combat. “The move towards modular construction seems to be picking up pretty quickly because it cuts out some of the labor expense and time to get a building up and running, particularly in the Bay Area where construction labor and resources are so scarce,” he said. “We see a lot of demand driven by that shortened construction cycle as well as that flexibility to repurpose space. We do think that the demand [for modular] construction is growing.”

In some ways, the recent acquisition of Maars by a number of investors could be seen as bridging the geographical gap when it comes to the growth of modular construction across the board. “The number of global customers that are moving up here from the Bay Area that we already do business with also gives us an opportunity to work with Maars with those global customers,” O’Brien said. “So we’ve found that that’s a nice opportunity to have that exposure to Maars products, because they may already have purchased in locations like the U.K. or the Middle East,” he said.

Seattle, Herman Miller, Maars Living Walls, Pivot Interiors, Catalyst Workplace Activation, modular construction, modular walls
Image courtesy of Herman Miller

In the longer term, the adoption of modular construction methods has been gaining traction over the last decade and will continue over the next few years, thinks Baugh. “We’ve been involved in modular construction for over ten years; the thing that’s interesting about Maars is that they’re new to the U.S….I think the trend towards modular construction is definitely growing and we’ll see more of that…the adoption rate has been somewhat slower on the West Coast, but it’s really picking up from what we’re seeing,” he said.

And while the recent acquisition of Maars was in many ways a mutually beneficial arrangement for all involved—and reflects the growing impact of modular construction in the world of interior design—demand in the long term will continue to be driven by the evolving needs of clients, according to Lane. “We’re excited about this acquisition as an avenue for addressing some of those customer needs and challenges. The aesthetics and scalability offered by Maars is something that also falls into customer demand to really differentiate the visuals of their space; that aesthetic layer is something that’s especially important when we’re looking at different vertical market segments,” she said.

Along these lines, modular construction is being adopted more readily by users at the earlier stages of the construction process as a means to heighten speed and efficiency for clients, according to O’Brien. “It really really goes back to growth. There’s so much opportunity that exists. Clients and landlords are making decisions differently about what they put in their buildings for their tenants,” he said. “There’s a sustainability and speed-of-construction aspect [to modular construction] and a financial depreciation benefit. And it seems like the whole region is really ripe for continued growth.”