WeWork Accelerates Expansion Of New Locations

In a move that has likely accelerated the speed at which WeWork is burning through cash, the company has opened nearly as many locations in the past several months as it did in the first half of 2019. The fast pace of new location openings is said to bring more risks for the company, which has made a worldwide brand for its concept of shared workspaces, but had to stop plans to go public due to investor concerns, Reuters reported.

On Oct. 10, WeWork had 622 locations open in 123 cities. By comparison, the company has 528 sites in 111 cities on June 30 as noted in its abandoned initial public offering (IPO) prospectus per the report. At the same time, the company’s website notes 117 sites as “just announced” and 89 sites as “coming soon.” On its website, the company says that it will soon have 845 locations in 125 cities, but the report noted it is not clear when those shared workspace sites will open.

The 97 new sites that WeWork brought to fruition in the first half of 2019 reportedly came at the cost of $2.63 million each on average in construction as well as design costs, according to the IPO document per the report. That figure reportedly marked an increase from the $1.91 million that 82 openings each cost in the first half of last year. According to its website, as cited by the outlet, the company brought on 94 new locations from the beginning of July to Oct. 10. 

The news comes as the parent company of WeWork is at a junction after its initial public offering (IPO) tanked and its chief executive officer stepped down. Lead investor SoftBank has a financing package in place to command WeWork and put Adam Neumann, the firm’s founder, further aside. SoftBank reportedly gave WeWork a financing offer that would give it control. The company reportedly wants to put money into WeWork and have a bigger role in operations.