WeWork Inc. looks to remain the top coworking firm in the Austin metro following its Nov. 6 Chapter 11 bankruptcy filing.
As part of the filing, WeWork is requesting the ability to reject the leases of certain locations that the company called "largely non-operational," adding all affected members have received advanced notice. However, a second filing on Nov. 7 that listed leases WeWork planned to reject did not include any of leases that the company holds in Austin.
WeWork has about 558,000 square feet of office space — about as much as six Walmart stores — for rent in Austin, according to ABJ's list of coworking firms. The No. 2 listmaker, Capital Factory, has 90,000 square feet.
WeWork’s offices can be found in downtown buildings like 600 Congress, in North Austin’s The Domain and other areas north and south of downtown. Some of WeWork's local landlords include Boston-based Beacon Capital Partners, Northwood Retail in The Domain and Los Angeles-based Arc Capital Partners.
"Austin remains a key market for WeWork and we are fully committed to providing our members here with world-class, flexible workspace solutions for the long term,” read a statement provided by a WeWork spokesperson. “We have exceptional confidence that we will emerge from this process a financially stronger company so we can focus on investing in our products, our services, our growth, our employees, and our members."
WeWork plans to reject 69 leases in Los Angeles, New York, Boston, Phoenix, Chicago, Atlanta, San Francisco, Denver, Seattle and St. Louis. In August, WeWork had approximately 18 million square feet of office space in the U.S.
WeWork's woes come at a time when a handful of office towers sit empty in downtown Austin, including the newest and biggest towers shaping the city's skyline, such as Sixth and Guadalupe and Innovation Tower. Remote work schedules are keeping some employers from utilizing downtown office space, while others are shrinking their real estate footprint to tighten spending amid a tough economy, like many in the tech sector. Last month, the Austin area had a record 6.2 million square feet of office space available for sublease, with 63% of that space being vacant, according to commercial real estate firm Partners.
