Coworking giant WeWork Cos. Inc. has decided to stop signing new lease agreements with landlords in a bid to cut costs amid the delayed IPO of its parent The We Co., London's Financial Times reported, citing people with knowledge of the matter.
WeWork, which recently saw Adam Neumann resign as its CEO, reportedly often upgrades the spaces it leases so that it could re-lease those spaces to its own customers.
The move comes amid reports that WeWork's new management is considering several cost-cutting measures, including laying off thousands of employees and abandoning or closing noncore business lines, including Managed by Q Inc. The FT added that the company has received tentative expressions of interest for Managed by Q, Conductor and Meetup.
The We Co. is also contemplating cutting the valuation it will seek in its planned IPO to around $20 billion, a substantial decline from the $47 billion valuation it achieved in a private fundraising round in January, Reuters reported separately, citing people with knowledge of the matter.
Meanwhile, WeWork's head of real estate development, Granit Gjonbalaj, plans to step down and is discussing his exit package, The Real Deal reported, citing unnamed sources. A number of other high-profile company executives have reportedly departed or are set to depart.
