WeWork to shrink Perth presence

WeWork is set to shrink its presence in Western Australia, as the global flexible workspace provider files for bankruptcy in the United States.

The company, which has struggled since the pandemic as it committed to tracts of office space around the world, occupies 8,000 square metres in Perth’s Central Park.

But WeWork is in the process of vacating some of its eight floors at the 152 St Georges Terrace building, as part of its global plan to reduce its exposure to the office market.

A spokesperson at the New York-based company today confirmed the move, but says its decision to file for bankruptcy will not affect its franchises outside of the US and Canada.

“We are downsizing our presence at 152 St Georges Terrace but we are not exiting the location,” the spokesperson said.

“We have already informed impacted members and working with them to relocate them within our existing space.”

In a statement, the company said it had commenced a restructuring agreement with its creditors and streamline its portfolio of office space.

As part of its strategy to streamline its global real estate portfolio, WeWork is embarking on a lease rejection plan that is says will position it for operational and financial success.

“As part of today’s filing, WeWork is requesting the ability to reject the leases of certain locations, which are largely non-operational and all affected members have received advanced notice,” the statement read.

WeWork grew rapidly following its $US47 billion valuation in 2019, ahead of its 2021 listing on the New York Stock Exchange.

The company, which is backed by Japan’s Softbank, was considered one of the fastest growing start-ups globally, but its fall has been just as dramatic.

As it filed for bankruptcy today, its debts were about $US19 billion.

Business News’ Data and Insights lists WeWork as the state’s second largest flexible workspace provider, behind Liberty Flexible Workspaces at 8,004sqm.

Liberty Flexible Workspaces chief executive Jamie Vine told Business News there was still high demand for flexible workspaces, despite the latest developments from WeWork.

“The flexible workspace market shouldn’t be defined by one business,” he said.

“Interest and demand for the space is higher than I’ve ever known it. Flexible workspace is here to stay and growing.”