Cash crisis for landlord
WeWork puts UK office portfolio ‘under review’
WeWork offices a casual office environment
WeWork’s new co-working office in Edinburgh is among 61 in the UK now under review by its new management.
The company, which promotes shared services in a communal office space, is drawing up plans to stop the New York based global landlord running out of cash.
Bloomberg reported earlier this month that WeWork is assessing its expansion plans in London and whether to proceed with about 28 potential letting deals in the city.
Fore Partnership had concerns about the strength of WeWork’s covenant and pulled out of the proposed letting in Bothwell Street. The 77,000 sq ft office building was acquired in partnership with Kier Property in 2016 for £23m.
The Edinburgh hub is home to tender adviser AM Bid, US technology company UserTesting, home security firm Boundary, led by Robin Knox and Paul Walton, and Upgrade Pack.
SoftBank, WeWork’s Japanese backer, is now assessing ways it can improve the profitability of its entire UK portfolio as part of a broader review of the business.
WeWork aborted a planned flotation in September and its valuation plummeted before shareholder SoftBank put together a multibillion-dollar rescue package after the collapse of WeWork’s float left the business nearing collapse.
WeWork’s losses more than doubled to $1.3bn (£990m) in the third quarter.
WeWork’s UK buildings are held in special-purpose vehicles with guarantees to the parent company. The company is not planning any outright closures at this stage, according to The Sunday Times.