WeWork Seeks Rent Relief
Following the news that SoftBank had officially retracted its $3 billion tender offer to WeWork, news broke out that the coworking brand is seeking rent relief from some of its landlords. According to The Real Deal, WeWork “has stopped paying rent at some of its locations in the U.S. for April as it aims to renegotiate its leases.” Additionally, WeWork has hired JLL and Newmark Knight Frank to help it convert lease deals into profit-sharing agreements. The coronavirus outbreaks has added additional pressure to the already struggling company.
Knotel to Walk Away from about 1 Million Sq Ft of Space
The Commercial Observer reported this week that Knotel “plans to give back about 20 percent of its 5-million-square-foot portfolio to landlords amidst the coronavirus pandemic.” According to the report, a large percent of the relinquished space will be from the company’s Manhattan portfolio. Amol Sarva, CEO of Knotel, has reportedly stated that the decision comes as Knotel doesn’t believe it will be successful after this recession.
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Flexible Workspaces Will Return to Public Favor After the Crisis Ends
Most flexible workspace operators are hurting at the moment; some have closed their doors, others remain open but have seen a drastic plunge in activity, and others are trying to find ways to prevent members from cancelling their memberships. While these are tough times for all, there is a silver lining to the crisis: it will boost demand for flexible space in the long-run. Once companies get back on their feet, “they might be looking for more flexible premises which offer shorter leases (two years at Workspace, versus five or 10 elsewhere) and more options to grow or shrink the space required,” according to a recent Financial Times article.
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