WeWork Inc (NYSE:WE) spun a downsizing of its UK and Ireland commercial footprint into a positive when announcing the completion of its “portfolio optimisation” in a Wednesday press statement.
“We are delighted to have finalised our portfolio optimisation in the UK and Ireland. Our updated footprint is made up of our highest quality and best-performing locations in the market,” said chief revenue officer Ben Samuels.
Samuels expressed his gratitude “to our members and landlord partners for their steadfast support and loyalty during this period”.
“WeWork is better positioned to continue defining the future of flexible work, and we’re committed to investing in our spaces and services to deliver the signature experience our members expect well into the future,” he added.
WeWork avoids detailing the extent of the optimisations, in terms of square footage or leasing obligations.
Globally speaking, it said it had amended over 170 office leases and exited 160 locations, reducing future rent costs by a projected $12 billion.
Proactive has reached out to WeWork for further details.
Downsizing
WeWork’s lease liabilities constituted over two-thirds of the business's total operating expenses in the second quarter of 2023- which was the last time it published a quarterly statement before entering Chapter 11 bankruptcy protection in November 2023.
“We are taking immediate action to permanently fix our inflexible and high-cost lease portfolio to achieve the sustainable operating model that we need to serve our members for many years to come,” chief executive David Tolley said at the time.
What followed was a comprehensive downsizing (a “rationalisation” in WeWork parlance) of its global operations across all major markets, including the US, Singapore, Canada, Europe and the UK.
WeWork is expected to emerge from Chapter 11 this month as a significantly downsized entity, having renegotiated hundreds of lease and loan obligations after getting the go-ahead from the US bankruptcy courts on 30 May.