October 4, 2019
WeWork’s initial public offering that wasn’t, and the resulting “turmoil” within the company, will cast “a shadow of skepticism over the market in the fourth quarter as owners re-evaluate WeWork’s tenancy, credit and contracts,” Savills’ Leslie Kamnitzer writes in the firm’s third-quarter Manhattan office report.
The We Company filed an S-1 on August 14, as New York City’s largest private-sector office occupier with a private valuation of $47 billion. Less than 60 days later, the IPO has been postponed until 2020 at the earliest, and WeWork has begun a “massive organizational restructure,” writes Kamnitzer.
This skepticism may create opportunity for tenants, “as unfunded or canceled WeWork expansions become available for traditional occupiers,” Kamnitzer writes. The services firm promises a scenario analysis in the near future that will evaluate the impact of a potential WeWork default on the New York City market.
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