WeWork bankruptcy

PandaBear

PandaBear

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WeWork’s $18 billion bankruptcy just took over 60% of NYC’s office space with it—the last thing the reeling commercial real-estate sector needed

I'm sure you can find it in every single news outlet. I guess this might be the trigger in the commercial REIT failure and cause a financial collapse of some sort. Office space vacancy has been high for a while after covid and never really get back up, and that was not priced in over a long period of time like the shopping mall declines.

If they are shedding the leases, that would suppress rent and therefore make their current tenants move or renegotiate for an even lower rent, causing a downward spiral for every landlord (REIT, Blackrock, etc).
 
PandaBear said:
WeWork’s $18 billion bankruptcy just took over 60% of NYC’s office space with it—the last thing the reeling commercial real-estate sector needed

I'm sure you can find it in every single news outlet. I guess this might be the trigger in the commercial REIT failure and cause a financial collapse of some sort. Office space vacancy has been high for a while after covid and never really get back up, and that was not priced in over a long period of time like the shopping mall declines.
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The retail & commercial "Work Space" has changed after co19. But there were many businesses that took advantage of it by filing bankruptcy to restart their failed attempt all over again.
 
PandaBear said:
WeWork’s $18 billion bankruptcy just took over 60% of NYC’s office space with it—the last thing the reeling commercial real-estate sector needed

I'm sure you can find it in every single news outlet. I guess this might be the trigger in the commercial REIT failure and cause a financial collapse of some sort. Office space vacancy has been high for a while after covid and never really get back up, and that was not priced in over a long period of time like the shopping mall declines.

If they are shedding the leases, that would suppress rent and therefore make their current tenants move or renegotiate for an even lower rent, causing a downward spiral for every landlord (REIT, Blackrock, etc).
Click to expand...
Neumann should've been jettisoned without the golden parachute. Scammer.
 
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Neumann was cheap and greedy. For his level of pay he shouldn't be siphoning chicken scratch money here and there. The biggest problem with WeWork is actually in the business model. Taking risk as a middleman requires a much higher profit margin and it is really not a tech business they advertise to be. At least with Uber and Doordash they have to write cell phone apps. If you rent office by the day with cell phone apps you are in big trouble. Masayoshi Son was at fault here.
 
VTECOverRated said:
Anyone who actually things we are not going down a 2008 x 10 scenario...is kidding themselves.
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Residential side we are actually OK as many have refi to 2-3% mortgage. Unless we tore down a lot of offices to turn them into condos, townhouses, single family homes, then we will definitely have some collapses.

In my area we see a lot of 1/F and 2/F office parks get torn down and turn into 5/F apartments.
 
we_work_01.gif
 
Hillbilly Deluxe said:
Man, I hate to hear that about Blackrock....
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www.reuters.com

Blackstone offers backstop to lure University of California in redemption-stricken REIT

Blackstone Inc on Tuesday said it had secured a $4 billion investment from the University of California in its unlisted real estate income trust (BREIT) that has been plagued by investor redemptions, after the private equity firm committed $1 billion to backstop the university's returns in the fund.
www.reuters.com www.reuters.com

I know Blackrock and Blackstones are different, just want to use this as an example on how they were propping up REIT earlier this year and were paying through the nose for a deal this expensive. Wonder what would WeWork bankruptcy leads to next.
 
We work was always sold to the public as some transformational social change when in reality all they did was rent office space.

With no one wanting to go into an office anymore the handwriting is on the wall for commercial real state in general.
 
Here's something for a little thought;

Our office lease in DT Chicago is up for renewal this year. Many tenants have greatly lowered their office space or went remote all together. Despite this, early last year no property management would budge on lowering their rent, even with dozens of vacant floors. Our property management wouldn't budge at all despite half the building being empty so we were going to get a smaller space built for us on a different floor. Now that plan got cancelled because the building couldn't acquire the loan for the build. If property mangement companies are unable to acquire loans to build half a floor for a tenant.....

BCBS:IL is consolidating their office spaces and getting rid of office outside of buildings they own.
 
I have often wondered what the people in those sky scraper offices were doing up there. Moving money around by computere and taking the pennies that fall out. See book: "Bonfire of the Vanities."
 
Allaneddie said:
I have often wondered what the people in those sky scraper offices were doing up there. Moving money around by computere and taking the pennies that fall out. See book: "Bonfire of the Vanities."
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I am probably naive. I see having an office in downtown high rise as having a physical store in a shopping mall. Some people need to see the people they are dealing with or product they buy in person to trust them, others need to go to gov departments like court and regulators to work out problems. Probably 90% of their work can be done online like 90% of the sales in the mall can be done online. Maybe that's why both malls and offices real estates are in trouble, because they are not worth 2 hours of driving.
 
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