WeWork has gone from Wall Street’s hottest float prospect to financial basket case as the business is unravelling at lightning speed – and this could have an impact on the London property market, an article in The Telegraph says.
A column by Chief City Commentator Ben Marlow says that although, officially, WeWork’s plans to join the stock market have only been postponed there seems little chance of this happening in the foreseeable future and that the shared-office provider is “running out of cash at a shocking rate.” He adds that the cancelled listing has left it with a $10bn ($8bn) hole in its balance sheet.
Of the potential impact on
the London commercial market Marlow says: ”The
fortunes of WeWork and the London
property market are closely linked. WeWork is the capital’s biggest office
occupier, and London is its second-biggest
market after New York.
Previous accounts have revealed that WeWork has UK rental commitments of £3.2bn over
the next two decades.”
Although often thought of as an office space provider WeWork is in fact a property investment company of a different kind, and one that controls a huge amount of space. The impact of any failure or even a change to its business model could be vast.