WeWork Isn’t a Tech Company

Re:WeWork Isn’t a Tech Company by rossdavidh on Wednesday August 21, 2019 @09:41PM (#20763864)

I believe you, but in markets like Austin, TX (where I live) it seems odd that a landlord would not just hold out for a more orthodox lease, since there is some shortage of retail space and rental rates are high. What am I missing as to why they would lease to such an SPE?

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Re:WeWork Isn’t a Tech Company by polygotdomain on Thursday August 22, 2019 @08:51AM (#20767439)

I agree with both the other answers (reletting space and branding), but there's another one that's just as important; increasing rent.

If there's a shortage of space, having WeWork take a chunk of it off the market is only going to move rents higher. Also, whatever you sign WeWork at is going to set a significant comp in the market, which can again push rents. Businesses do like the idea of being close to a WeWork, so that's going to put more pressure on rents.

There are tenants that are great in bull markets, some that are great in bear markets, and others that are great in both. I would very much describe WeWork as a tenant that is a great bull market tenant, but that's about it.

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Re:WeWork Isn’t a Tech Company by toomuchtodo on Wednesday August 21, 2019 @11:42PM (#20764447)

Confidence of rapid re-leasing in the event of WeWork default (which makes sense in a high demand area like Austin).

Disclaimer: Landlord

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Re:WeWork Isn’t a Tech Company by milquetoastaf on Wednesday August 21, 2019 @11:12PM (#20764319)

The branding. You can hold out for a high "orthodox" lease like storefronts in the West Village in NYC are doing (lots of famously ritzy streets dotted with vacancies) or you can hand the problem to We and use their network effect as leadgen.

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