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WeWork Fails To Pay Rent At Several US Locations: Report

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WeWork Fails To Pay Rent At Several US Locations: Report

WeWork has not paid rent at several locations in the United States as the pandemic decimates the company’s earnings. 

WeWork Contacting More Than 600 Landlords 

The office and workspace company has not yet paid its April rent at multiple locations as it tries to renegotiate leases, The Wall Street Journal reported Wednesday. 

WeWork has hired brokerage firm Newmark Group Inc. (NASDAQ: NMRK), formerly known as Newmark Knight Frank, to negotiate rent relief or convert leases into profit-sharing agreements in an effort to cut expenses, the newspaper said. 

"WeWork believes in the long-term prospects of our locations and our relationships with landlords across the world," a company spokesperson told the Journal.

The company is reaching out to more than 600 global landlord partners to “work in good faith” towards finding “asset-specific solutions that benefit all parties involved,” the spokesperson said. 

Most U.S. WeWork properties are still open, but remain empty, with the U.S. economy being largely shuttered due to the pandemic. Some of the landlords have been paid, while others have not.

Another Hurdle For WeWork After Failed IPO

Even before the start of the COVID-19 pandemic, WeWork had been making an effort to cut costs and convert leases to management agreements, the Journal said. 

The beleaguered firm has been running out of funds since its listing collapsed last year. The company was later bailed out by the SoftBank Group Corp (OTC: SFTBY). 

SoftBank has canceled its plans to purchase $3 billion in WeWork shares, leading to the shared office company suing SoftBank.

As of the end of 2019, WeWork had $4.4 billion in cash and cash commitments. 

Photo courtesy of WeWork. 

 

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