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Drew Jones – Design & Innovation
Jonathan Price – CRE & Flex Expert
New York-based Walter & Samuels have filed a lawsuit against WeWork for reportedly trying to move its tenants to another location after defaulting on its lease with the landlord.
The Chelsea landlord, which owns 214 West 29th Street, filed the suit last week in New York Supreme Court in an effort to recoup its damages, which they estimate would amount “in excess” of $37 million.
According to the lawsuit, WeWork defaulted on its lease after not paying a $584,500 security deposit. It also claims the coworking company is in default since it never replenished a deposit account after Walter & Samuels withdrew WeWork’s past due rent for January and February of this year.
Walter & Samuels allege that they are entitled to take over WeWork’s subtenants if it defaulted on its lease since it invested “tens of millions of dollars” to build out the space for the operator.
The 15-year lease signed in 2018 allowed WeWork to take up 100,000 square feet in the building and aimed to accommodate enterprise members that require higher-quality layouts and HVAC systems.
In June of 2020, the landlord provided the fourth floor of the building to WeWork for occupancy, but instead of paying a security deposit for the space, the coworking operator asked the landlord to take back the space. If the landlord refused, WeWork stated it would abandon the entire building.
