Amid asset sales, boardroom battles, and seemingly endless litigation, WeWork has decided to jump on the "well, why should we have to pay according to a signed contract when no one else is" bandwagon and is reportedly skipping rent payments on numerous properties.
Amid an effort to aggressively cut costs as the economic downturn crushes any revenues, The Wall Street Journal reports, according to people briefed on the matter, that WeWork has yet to mail in its April rent check at numerous properties while it tries to renegotiate leases. (Quick aside - WeWork mails in its rent-checks?)
“WeWork believes in the long-term prospects of our locations and our relationships with landlords across the world,” a WeWork spokesperson said in a statement.
“Rather than implementing a companywide policy on rent payments, we are individually reaching out to our more than 600 global landlord partners to work in good faith towards finding asset-specific solutions that benefit all parties involved.”
WeWork isn’t treating all landlords the same. While some reportedly say they have been paid, others say they are still waiting for their checks.
One glance at the company's bond price tells you all you need to know about the cash situation at this once almost $50 billion market cap mockery of an office space company.
Bloomberg's Gillian Tan reports that WeWork executives have been pitching solutions including revenue-sharing agreements. Such deals would give landlords the chance to collect a portion of future revenue generated by each property. Early indications are that landlords are reluctant, people with knowledge of the matter said last week.
Mark it zero, Masa-san!