WeWork's CEO Has Earned Millions In Rent From Buildings He Owns That Lease To WeWork

The We Company CEO Adam Neumann is also a WeWork landlord in some cases, using money he has made as founder of one of the country's most valuable startups to buy buildings in which WeWork is a tenant.

The arrangement concerns a number of investors in WeWork as a potential conflict of interest, the Wall Street Journal reports.

Since gaining effective control of WeWork about five years ago, Neumann has bought an interest in 88 University Place in Manhattan and properties in San Jose, California, all of which lease space to WeWork.

According to a prospectus published by WeWork last year, it paid more than $12M in rent to buildings “partially owned by officers” of the company in 2016 and 2017.

Such officers stand to make $110M more from those leases before they expire, the prospectus said.

That kind of arrangement is regarded as unusual in corporate governance, since it might inspire executives to act in their own interest over that of the company, Fortune reports.

WeWork denies any conflict.

"WeWork has a review process in place for related party transactions," the company said in a statement. "Those transactions are reviewed and approved by the board, and they are disclosed to investors.”

Word of Neumann's landlord status came not long after he unveiled a restructuring of the organization this month.

The We Company, which lists Neumann, Miguel McKelvey and Neumann's wife, Rebekah, as founders, is now the umbrella company for three separate branches: WeWork, WeLive and WeGrow.

At the same time the restructuring was announced, WeWork closed on a $6B investment from SoftBank, $4B of which had previously been disclosed. The latest SoftBank deal values WeWork at $47B.

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