Landlords face shedding billions in hire owed by WeWork, because the work house supplier grapples with the rise of residence working.
British landlords are uncovered to greater than £3bn in rental commitments from WeWork, London’s greatest non-public tenant.
A Telegraph evaluation of WeWork’s UK subsidiaries exhibits the pay-as-you-go workplace supplier has signed leases value £3.1bn at greater than 50 places in Britain.
However the agency, as soon as valued at $47bn (£37bn), has warned that there are “substantial doubts” over its skill to maintain working and its shares have misplaced 97pc of their worth over the previous 12 months.
The corporate, which takes lengthy leases from workplace suppliers and sublets them on month-to-month contracts, slammed the brakes on a world enlargement and pursued profitability after founder Adam Neumann’s 2019 plans for a New York flotation publicly unravelled.
The corporate went public two years later. Nevertheless, the rise of working from residence and a surplus of workplace capability has hit the enterprise.
WeWork had £3.8bn in UK lease commitments on the finish of 2021, in response to the latest filings by its numerous UK subsidiaries.
After closing some places, it continues to owe a minimum of £3.1bn in leases that in some instances final so long as 20 years throughout 56 properties.
WeWork stays London’s largest non-public tenant with round 3 million sq ft of house, in response to information firm CoStar – equal to the quantity of floorspace in three Shard buildings.
They embody a 301,488 sq ft constructing on London’s Southbank owned by Mike Hussey’s Almacantar and 1 Poultry of South Korea’s Hana Monetary.
Different landlords embody the Qatari royal household and Brookfield Property Companions, who personal a 285,000 sq ft WeWork workplace in Canary Wharf.
Landlords are involved {that a} potential collapse of the shared workspace firm might go away them uncovered to tens of millions of kilos in owed hire.
WeWork has been shedding workplace leases and properties it owns by its property arm, WeWork Capital Advisors. It’s presently within the technique of promoting its 99 Victoria Avenue workplace which is underneath supply to a subsidiary of Constancy, and it’s trying to promote its 51 Eastcheap constructing in a sale and leaseback transaction.
David Tolley, interim chief government of WeWork, mentioned earlier this month that the agency’s woes had been right down to an oversupply of workplaces as individuals proceed to work remotely.
He mentioned: “Extra provide in business actual property, growing competitors in versatile house and macroeconomic volatility drove greater member churn and softer demand than we anticipated, leading to a slight decline in memberships.”
A WeWork spokesman mentioned: “We’re assured in our skill to fulfill the evolving office wants of companies of all sizes throughout sectors and geographies, and our long run firm imaginative and prescient stays unchanged.
“Our members stay our high precedence, and we’re resolutely targeted on delivering for them for the long run.”
