Tuesday, April 2, 2024

"Why on Earth Is Adam Neumann Trying to Buy Back WeWork?"

I think it's called an idée fixe.

From Curbed New York, March 28:

Adam Neumann has put together a bid of more than $500 million to buy WeWork, the bankrupt co-working company, The Wall Street Journal reported this week. The co-working start-up’s co-founder and once–chief executive has spent the last several months trying to find his way back to the company he helped create in 2010 before being ousted in 2019, but WeWork doesn’t seem to want him back. In response to the news of Neumann’s offer, WeWork basically pulled an I don’t know her, telling the Journal that it receives “expressions of interest from third parties on a regular basis.” One might have a few questions here. Like: Does it make sense to get back into the office-space-leasing hustle at a moment when no one seems to be going into the office like they used to? And why would Neumann, a billionaire twice over who is currently running a similarly hype-y residential start-up called Flow, even want to?

Here’s what we know.

Wait, who wants to rent office space right now?
While there is a glut of office space available at the moment, the office is not, as was once feared and hoped, dead. Most of New York’s office workers settled into some kind of hybrid schedule over the last few years — on any given day, 52 percent of office workers are at their desk, but just 9 percent come in five days a week, according to the Partnership for New York City. Companies still want and need office space, but those needs are different than they were before the pandemic. Which is where co-working space, or as experts are now calling it, flexible office space, comes in.
So co-working is still a thing?
Yes. Commercial brokers say that as companies have shrunk their overall footprints after COVID, the demand for co-working space has only increased.
Okay, then it makes sense Neumann wants WeWork back.
Co-working can be a viable business, and so, too, could WeWork. But it seems doubtful that Neumann, of all people, would be the one to finally make WeWork a going concern. The business of co-working has also changed from what it once was, says Julie Whelan, who leads a research team at CBRE. The aughts-era idea of co-working popularized by WeWork — a bunch of 20-somethings paying monthly fees for individual desks in shared offices where they could meet other entrepreneurs and drink free craft beer — has shifted to a more à la carte office model many different types of businesses are interested in using. Flexible workspaces — smaller, built-out offices with shorter lease terms — allow younger companies to lease spaces without long-term commitments and more established companies to access extra space if they need to accommodate visiting workers, rent extra conference rooms, or open satellite offices with lower overhead. While office leasing is muted right now, the demand for spaces under 20,000 square feet is higher than ever, according to Whelan.

What are the details of the bid?....


Please, please let them come public. I miss the days of:

WeWork:“Our valuation and size today are much more based on our energy and spirituality than it is on a multiple of revenue."
Roger that, energy and spirituality. Over.

Maybe it's me with the WeWork idée fixe