Fitch Ratings, a credit and market ratings agency, has downgraded WeWork as it forecasts a tumultuous new year for the coworking company.
WeWork’s rating fell from CCC+ to CCC last week, and also saw its senior unsecured bonds rating fall from CCC- to CC.
Fitch expects further complications for the coworking industry, and particularly WeWork, as companies continue to take pre-recessionary caution and cut back on spending.
During the third quarter, WeWork reported lower-than-anticipated earnings, making it that much more challenging to rebound to pre-pandemic levels.
Despite WeWork and many other coworking firms seeing higher levels of demand due to the embrace of hybrid models, a recession could become a gatekeeper in the industry solidifying its stance as a competitive player in the real estate world.