WeWork has a $25 billion pile of lease obligations to untangle
WeWork Inc. is expected to file for bankruptcy as soon as next week, a move that could allow the embattled office-space provider to cherry-pick leases it wants to keep or reject, according to four restructuring experts.
In a bid to salvage a business it came to dominate, the cash-burning company began slashing its leasing obligations after its botched initial public offering in 2019, with negotiations with landlords eventually saving the company $12.7 billion on lease expenses. WeWork’s main problem has been that it rents out desk space short-term, but has long-term leases at top market rates that average 15 years, with landlords spread across hundreds of locations in the U.S. and abroad. It has yet to become a consistently profitable business.
Another possibility is that a liquidation could wipe out a historic volume of office leases in one fell swoop, further pressuring an already distressed U.S. office market. Retailer Bed Bath & Beyond’s bankruptcy earlier this year ended in a wind-down and liquidation. “I don’t see a way this works out for WeWork or the landlords,” said Shlomo Chopp, a commercial real-estate restructuring expert and bond buyer at Terra Strategies, about any WeWork bankruptcy.
“The cool thing about leases is that you can do some funky stuff as a debtor in a bankruptcy,” said Isaac Marcushamer, partner and co-founder of DGIM Law, which specializes in restructurings. “You can say, ‘Hey, I don’t want to have this lease anymore,’ walk away and the landlord can have it back.”
Indonesia Berita Terbaru, Indonesia Berita utama
Similar News:Anda juga dapat membaca berita serupa dengan ini yang kami kumpulkan dari sumber berita lain.
WeWork’s shares plunge 37% on bankruptcy reportsWeWork’s shares plunged 37% in pre-market trading Wednesday, following news reports that the beleaguered company plans to file for bankruptcy as early as next week as its losses mount.
Baca lebih lajut »
WeWork shares sink on reports of imminent plans for bankruptcy filingWeWork shares sink on reports of imminent plans for bankruptcy filing
Baca lebih lajut »
Today’s deals: $25 Amazon credit, $189 USB-C AirPods Pro 2, KitchenAid food processors, LG OLED TVs, moreWednesday's top deals include an Amazon promotion with a $25 credit, Apple AirPods Pro 2 with USB-C, KitchenAid mixers, and more.
Baca lebih lajut »
WeWork bankruptcy likely to come ‘sooner than later,’ says CreditsafeIn August, WeWork said that ‘substantial doubt’ existed about the company’s ability to continue as a going concern
Baca lebih lajut »
Startup Darling WeWork Teeters on the Brink of BankruptcySource of breaking news and analysis, insightful commentary and original reporting, curated and written specifically for the new generation of independent and conservative thinkers.
Baca lebih lajut »