Bankrupt WeWork Spares D.C. From Lease Rejections But Owes Carr Properties $3.6M
Fallout from WeWork's bankruptcy bombshell is thus far having a relatively muted effect on the D.C. market, according to court filings.
The coworking giant filed for Chapter 11 bankruptcy protection Monday evening amid large lease liabilities and debt obligations.
Among its 30 largest unsecured creditors, WeWork listed one obligation in the D.C. market: $3.6M owed to D.C.-based developer and owner Carr Properties.
WeWork has locations in Carr’s 865K SF Midtown Center complex downtown and The Wilson, which rises 23 stories on Wisconsin Avenue in Bethesda.
No D.C. locations were listed among the 69 leases WeWork is asking the U.S. Bankruptcy Court for the District of New Jersey to immediately reject. But over the past few years, WeWork has closed at least nine D.C. spaces.
A WeWork spokesperson told Bisnow the company is in active negotiations and has no updates on the future of WeWork's D.C. locations.
"Washington D.C. remains a key market for WeWork and we are fully committed to providing our members here with world-class, flexible workspace solutions for the long term," the spokesperson told Bisnow in an email Tuesday. "Our commitment to the city is unwavering as we continue to work collaboratively with our landlord partners, aiming to craft solutions that set all parties up for sustainable success."
The District was one of WeWork’s early jumping-off points. It began taking modest footprints downtown around 2014 before securing large swaths of office space with a string of leases in 2018 and 2019.
But after being dealt setbacks from its failed initial public offering in 2019 and the onset of the pandemic in 2020, WeWork began to shrink its D.C. footprint.
In October 2020, the company closed three of its oldest offices in D.C., all owned by Douglas Development. It shuttered locations at the Manhattan Laundry building near U Street, the Wonder Bread Factory in Shaw and 718 Seventh St. NW in Chinatown. Three months later, WeWork revealed plans to close four more spaces in Crystal City, Dupont Circle, Chinatown and the H Street corridor.
In 2022, the company shuttered a location at Metropolitan Square near the White House, where it once occupied as much as 226K SF, and it vacated a Mount Vernon Triangle lease at 655 New York Ave. NW in December.
