The office space landlord We Work wants to escape from bankruptcy by the end of May. The company announced on Tuesday that rents had been reduced by more than $8 billion in negotiations with the owners of 150 locations. That is more than 40 percent of the rents, which are adjusted to the changed market environment. Around 150 locations would be given up by stopping rent payments in the event of bankruptcy or by entering into agreements with landlords. The Chapter 11 bankruptcy proceedings are scheduled to be lifted on May 31, according to the statement.
It is still unclear who will own We Work. Before the bankruptcy, the Japanese technology investor Softbank held more than 70 percent. In November, the company agreed with its creditors to convert $3 billion in debt into equity. However, Softbank should remain involved. Company founder Adam Neumann recently offered to buy back We Work for a good $500 million. Under him, the young company had become the most valuable start-up in the USA; at one point, WeWork was valued at $47 billion.
But the trend towards working from home, which increased during the corona pandemic, called the business model into question. We Work has never been in the black. With the bankruptcy, We Work was looking for the chance to get out of expensive rental agreements for vacant space.