After spending most of a year downsizing its real estate footprint after declaring and then emerging from bankruptcy, WeWork is partnering with a third-party coworking operator to expand its reach.
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WeWork announced the launch of its Coworking Partner Network in a press release Tuesday. The initiative hinges on a new partnership with Vast Coworking Group, a privately owned franchiser of coworking spaces whose presence in suburban markets complements WeWork's urban footprint.
Under the agreement, users of WeWork Workplace, the company’s space management software, will have access to more than 75 partner locations in more than 50 new markets across the United States and Canada.
“This network furthers our commitment to giving WeWork members even more flexibility in where they work, especially to dispersed and hybrid teams,” WeWork CEO John Santora said in the release. “With demand for flexible office solutions increasing, Vast’s convenient locations further enable us to meet our members where they need us most, with high-quality workspaces that enhance productivity and collaboration.”
WeWork's new partnership agreement could be a play to expand in a lower-cost, lower-risk fashion after a dizzying fall from prepandemic heights that saw the company drastically reduce its North American locations.
In 2019, the coworking giant was valued at $47B, with a global footprint of 850 locations across the world. But the pandemic's impact and the weight of hundreds of long-term leases sunk the company's value, and it filed for bankruptcy late last year, initiating a lengthy process to exit.
WeWork’s footprint now consists of about 575 locations after concession negotiations, including reduced rent, shortened lease terms and a smaller footprint.
As part of the legal action, Yardi Systems also became the majority owner of the coworking titan. Yardi pledged to inject WeWork with $50M to keep it operational until it emerged from bankruptcy, then an additional $400M to cover the costs to exit restructuring.
This is WeWork's latest major move under the Yardi regime, following the high-profile CEO hire of Santora, a former Cushman & Wakefield executive, in June.
A WeWork spokesperson told Bisnow the partnership with Vast Coworking was an example of the company growing where members need it most, adding the company intends to add more locations and operators to its network.
CLARIFICATION, OCT, 16, 10 A.M. ET: The number of WeWork locations has been updated based on new information from the company.
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