Top CRE Execs Answer 3 Important Questions On The Future Of WeWork
This article originally appeared on Bisnow.
It took eight and a half years for WeWork to climb to the top of the commercial real estate world, dominating the world's biggest office markets and raking in billions in investment. It took less than two months for it all to come crashing down.
Much has been written about WeWork and now-former CEO Adam Neumann's meteoric rise and precipitous fall. And while WeWork has some very public, very persuasive critics, those who it really needs to convince of its durability are future investors and the industry it spent years disrupting. That's who Bisnow wanted to hear from, so that's who we asked.
In an online poll of more than 500 Bisnow readers, 54% said they expect WeWork to file for bankruptcy. Fifty-nine percent of respondents believe it will be much harder, but not impossible, for WeWork to sign leases, while 12% agreed with the statement, "No one will want to lease to WeWork."
We also put out the call to hundreds of the smartest, most influential people in office real estate across the country to ask about the future of WeWork and its impact. Most of them declined to answer. Here are some of the best responses we did get, gathered by the Bisnow team and lightly edited.
Will the attitude of landlords and the office market toward WeWork change after everything we’ve learned?
From an occupier’s adviser perspective, we will certainly increase due diligence on the viability of WeWork locations. But this is not exclusive to WeWork. The public offering process has merely created more awareness and transparency in the coworking business models, how leases are structured and potential risks by investors and users of their product. Our focus will continue to be in negotiating on behalf of our occupier clients. From this perspective, we will continue to scrutinize the underlying health of any potential landlord, whether it be a traditional building owner or an operator of a flexible office space.
Is the IPO being shelved good or bad for the office market?
I think the disclosures from the IPO process will be helpful. Now there will be more focus on the viability of different coworking business models.
What will we be saying about WeWork at this time next year?
I think we will say that WeWork was the catalyst for the formation and growth of modern coworking providers. The brand is almost synonymous with coworking, and I believe over time it will be able to reposition itself as a leader in the industry.