Real estate firms Savills and Transwestern have predicted the U.S. markets that face the biggest risk from WeWork’s issues, just as the company chose new real estate veteran Sandeep Mathrani to be its new CEO.
By mid-year 2019, WeWork accounted for 70% of all coworking take up in the U.S. with 27 million square feet across 365 properties according to Transwestern.
New York City, the company’s base, has the greatest exposure. Currently, the company takes up 8.09 million square feet according to Savills, with 49% of the space located in Midtown.
Los Angeles comes in second as the company takes up 2 million square feet of the city’s 4.9 million square feet of flexible office space.
San Francisco is third with 1.5 million square feet. However, the city has only 2.9 million square feet total of flexible office space options. Availability of WeWork space in San Francisco is at 20.2% according to Transwestern. Furthermore, the city has the lowest availability at WeWork properties in the construction/leasing stage at 11.5%.
One of the major markets that has the lowest exposure to WeWork is Houston, where it operates just 245,000 square feet.