It's not an uncommon business practice to have SPEs for ventures like this. In fact, nearly each of our investments were backed by SPEs that held the property. If you had some sort of evidence to WeWork was trying to defraud or break the lease in some substantial way, then I guess you'd have some legal recourse, but the whole purpose for the SPE is to limit legal exposure (which is exactly why we did it).

The thing is that the SPE is absolute requirement for WeWork. They will walk away if you try to challenge them on it. It's ultimately not an issue unless shit hits the fan. Smart underwriters will recognize that and price it accordingly. Unfortunately, there will be many that don't and execs that are trying to push value, so won't want a conservative view on those leases.

The biggest risk (outside of WeWork itself) is bullish investors buying properties at inflated values due to WeWork being on the rent roll, not doing their due diligence on the WeWork lease, and the bottom dropping out.

Generally speaking courts are much more reluctant to look behind special purpose vehicles in contract than they are in tort, especially so when dealing with sophisticated parties.

As polygotdomain wrote landlords know that want We on the lease, ask for it, don't get it, and sign anyway. Short of a smoking gun showing outright fraud courts are unlikely to disregard that bargain.