WeWork Inc., once a high-flying co-working startup, has officially filed for bankruptcy after its failure to recover from the pandemic and an initial public offering (IPO) in 2019.
The New York-based company filed for Chapter 11 bankruptcy in New Jersey, listing assets and liabilities ranging from $10 billion to $50 billion, allowing it to continue its operations while developing a debt repayment plan.
WeWork had entered into a comprehensive debt restructuring agreement earlier in 2023, but soon faced financial difficulties once more.
By August, the company expressed “substantial doubt” about its ability to sustain operations and subsequently announced plans to renegotiate the majority of its leases, as well as withdraw from underperforming locations.
As of June 30, WeWork maintained a vast real estate presence, spanning 777 locations across 39 countries, with occupancy levels near those of 2019.
However, the company has struggled to achieve profitability.
The co-working giant’s path to bankruptcy was a tumultuous one. After its planned IPO failed in 2019, it opted to go public in 2021 through a merger with a special purpose acquisition company (SPAC).
The IPO debacle led to the resignation of founder Adam Neumann as CEO and a sharp decline in WeWork’s valuation, which had once reached as high as $47 billion.
WeWork’s struggles are not unique, as other shared office space companies have also faced difficulties since the pandemic disrupted traditional work patterns.
Knotel Inc. and subsidiaries of IWG Plc sought bankruptcy protection in 2021 and 2020, respectively.
