WeWork Reaches Deals With NYC, Boston Landlords To Keep More Locations Open
WeWork has amended another set of leases as it attempts to pull itself out of Chapter 11 bankruptcy.
Landlords at two locations in New York City and one in Boston have agreed to alter their contracts with the coworking giant, according to records filed in bankruptcy court Tuesday, as WeWork decides whether to keep or cut hundreds of its offices.
At 154 W. 14th St. in Manhattan's West Village, where WeWork signed a 122K SF, 15-year lease in 2018, the company hashed out a deal to reduce its rent, shrink its space, reduce its letter of credit and terminate its guarantee, according to the filing in New Jersey Bankruptcy Court.
A source familiar with the negotiations told Bisnow that WeWork will vacate the 10th and 11th floors of the 166K SF, 12-story building, which is owned by Abner Properties. The company also agreed to pay $651K to the landlord to cure unpaid rent, according to the filing. The source said the amount will be due five days after the judge approves the lease assumption.
Representatives for Abner Properties couldn't be reached for comment, while representatives for Koeppel Rosen, which manages leasing at the building, declined to comment.
A similar deal was struck at Boston’s One Beacon St., owned by MetLife and Norges Bank Investment Management. In 2017, WeWork signed a lease for a 60K SF office in the Beacon Hill neighborhood. But moving forward, its footprint and rent payments will be reduced, and it has agreed to pay a cure amount of over $470K “at a future date,” according to the filing.
In Tribeca, where WeWork has occupied the entire 60K SF office portion of United American Land’s 408 Broadway, the coworking company switched to a revenue-sharing model and revised its expiration date, according to the filing, likely with a shortened term. The revenue-sharing agreement is the second such deal the company has struck during its bankruptcy, after WeWork reached a similar agreement with its landlord in Portland, Oregon.
A MetLife spokesperson declined to comment. Officials with United American Land didn't respond to Bisnow's request for comment.
Since September, WeWork has reached new agreements at more than 80 buildings worldwide, saving a total of $1.5B in rent, a spokesperson said. Since filing for bankruptcy in November, it has rejected leases and contracts at a total of 89 buildings. Still, many conversations with landlords remain ongoing.
In January, it was reported that WeWork has withheld approximately $33M in rent payments, a move landlord attorneys decried as "strong-arm" tactics. A spokesperson told Bisnow at the time the rent was withheld from landlords who weren't coming to the negotiating table.
