The WeWork Workout
Convert to Office Condos and Live To Work Another Day

This summer, many of the ongoing concerns that have surrounded WeWork came to a head as the coworking giant began planning its IPO. By the end of September, the company withdrew its IPO, and Adam Neumann was ousted as CEO along with several other key executives. In late October, WeWork reached an agreement to be taken over by SoftBank Group, its primary investor, in a deal that will value the embattled office-space company at approximately $8 billion (down from $47B). As a result, the future of WeWork remains uncertain. However, what is certain is that if WeWork ultimately fails, landlords will be in trouble.

WeWork’s Formula
WeWork’s locations occupy the less desirable, lower floors of office buildings. This strategy seemed to be a win-win for both WeWork and landlords alike—and today the company is the largest private tenant in New York City. As a result, these landlords took the opportunity to refinance their mortgages based on now-higher occupancy rates.

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