Tag: WeWork

By Lauren Feiner for CNBC

WeWork announced Wednesday it is creating a fund with $2.9-billion of total equity capital to buy stakes in buildings it rents from.

The company has previously been criticized for CEO Adam Neumann’s stake in buildings he rented to the company.
The fund, called ARK, will serve as WeWork’s “global real estate acquisition and management platform,” according to a press release.

WeWork has become a business with a multi-billion valuation by being a prolific tenant. Now, it is starting a nearly $3 billion fund to become a landlord, too.

WeWork, which recently renamed itself to The We Company, is creating ARK, a “global real estate acquisition and management platform,” to buy stakes in buildings in which it plans to lease a lot of space, the company announced Wednesday. It will begin with $2.9 billion of total equity capital.

“ARK will focus on acquiring, developing, and managing real estate assets in global gateway cities and high-growth secondary markets that will benefit from WeWork’s occupancy,” according to the release. It will use WeWork’s own technology and relationships to access real estate opportunities and will “immediately stabilise assets by executing a proven pre-packaged business plan and will apply The We Company’s holistic solutions for real estate owners, based on The We Company’s established capabilities in sourcing, building, filling, and operating properties.”

The fund could further complicate questions about WeWork’s allegiances, which were illuminated by a Wall Street Journal report in January that revealed CEO Adam Neumann has profited by leasing buildings he owns to WeWork. Under the new plan, Neumann will actually transfer some of his real estate holdings into the ARK fund, Bloomberg Businessweek reported.

While this may provide better optics for the company, since ARK will be run independently from WeWork’s main business, ARK will still be under The We Company’s umbrella, according to Businessweek. A WeWork spokesperson declined to confirm or comment on the transfer of Neumann’s real estate holdings to CNBC.

But ARK also may provide a level of stability for WeWork and its investors, which is a key step as it prepares for a public offering. WeWork, like other recent tech IPOs, is still unprofitable. The company said it had a net loss of $1.9 billion on $1.8 billion in revenue in 2018, and a net loss of $933 million on $886 million in revenue in 2017, according to a presentation shared with CNBC in March. Lyft and Uber, which both recently debuted with losses, have fallen short of expectations in their brief tenures on the public market so far due to concern about their ability to close their margins in the future.

By Helena Wasserman for Business Insider SA

The American office-sharing giant WeWork will open its first office on the continent in Rosebank, Johannesburg.

WeWork offers large shared workplaces for individuals and companies who don’t want the hassle and cost of maintaining their own offices.

It is renowned for creating comfortable, millennial-friendly surroundings, which include having open lounges and plush sofas, as well as free coffee, craft beer on tap and even mouthwash in the bathrooms.

All WeWork offices have lounges and conference areas.

Offices typically have private phone booths and a communal kitchen. Some even have gyms, as well as ping-pong, pool and foosball tables.

Fast internet comes standard as does “business-class” printers, front desk service, fruit-infused water and access to office supplies. Buildings are typically open 24 hours a day and offer package delivery services.

WeWork offices also offer free coffee.

Launched in 2010 in New York, WeWork has been called the most hyped start-up in the world after Softbank announced a plan to invest $16 billion into the privately-held company last year. The investment would have made WeWork the second most valuable start-up worldwide, but the Japanese behemoth has since cooled on its plan, scaling down its commitment to only $2 billion.

Still, WeWork is massive. The company has 400 offices in 100 cities, with 400,000 members who pay monthly fees to use its offices. It’s the biggest office tenant in both New York City and London.
The majority of WeWork members work for themselves – but almost a third of its members are businesses, who rent space for their employees.

WeWork office decor has been described as “startup kitsch”.
Its first South Africa office will be at the brand-new Rosebank Link building located at 173 Oxford Road. WeWork will rent it from Redefine Properties, under a revenue sharing agreement.

A Redefine representative said the building should be ready for occupation by August. WeWork will occupy six floors.

Up to 2 000 members could be accommodated in its office, and there will be a gym and restaurants in the building, as well as a Food Lovers Market. The building has direct access to the Gautrain station through “a landscaped pedestrianised thoroughfare” that runs underneath the offices.

WeWork has not yet confirmed local membership costs. In India membership for a “hot desk” (meaning you won’t have a dedicated place to sit) costs R1,100 a month, while a dedicated desk comes to R2,000 and a private office is close to R4,000. In the US, membership fees are much more expensive, with a hot desk starting at around R5,000 a month.

Africa is the only continent WeWork hasn’t yet entered, but Eugen Miropolski, managing director of WeWork International, tells Business Insider South Africa there is “huge potential for WeWork in Africa”.

“South Africa makes sense for us from a global expansion perspective: we’re entering a new continent in a country which has close ties to other major WeWork communities such as Europe where we have a strong community of over 60 000 members,” Miropolski says.

The Rosebank WeWork space will be specifically designed to reflect the Joburg culture, he added. A local team will be hired to “programme” the space. “They have to be connected to the culture.”

He hopes that the WeWork space in Johannesburg will bring together “a community of creators from diverse backgrounds including entrepreneurs, startups and large corporates” which will spark collaboration and help to grow the businesses.

Follow us on social media: 

               

View our magazine archives: 

                       


My Office News Ⓒ 2017 - Designed by A Collective


SUBSCRIBE TO OUR NEWSLETTER
Top