WeWork Warns European Staff Of Coming Job Cuts, Forced To Put Global Expansion On Hold
The WeWork travesty continues to unfold in grand fashion. The company, slated just weeks ago as a potential IPO candidate at a valuation of more than $40 billion, has seen its valuation plunge to well under $10 billion and has had its corpse only temporarily resuscitated by a bailout from SoftBank.
As the company slashes jobs and restructures to try and avoid what seems like an almost foregone conclusion of eventual bankruptcy, its “cost cutting” measures are kicking in overseas. The company has put its plans for global expansion on hold and has notified its workers in Europe that job cuts are on the way, according to Bloomberg. WeWork is also currently rethinking some of its prime overseas leases.
The company’s employees in Europe, Middle East and Africa will all have “consultations” this week with the company. The number of job cuts and the potential timing has yet to be decided.
WeWork commented: “WeWork is in conversation with employees in EMEA as we make changes to our operating model and workforce in light of our refocused strategy. Leadership has been diligent in its decision making, and we are committed to treating our colleagues fairly and with respect.”
The company is also rethinking its expansion plans for London and its plans to proceed with about 28 office deals in its second largest market. The deals that are under review are at “varying stages” and the number of leases that the company will take on remains up in the air.
The company is also considering surrendering part of its recently signed lease of four floors – about 60,000 square feet – near Hong Kong’s business district. The company had entered into a 9 year lease in August for the floors in the Hopewell Centre in Wan Chai.
Recall, yesterday, SoftBank beefed their earnings report, posting a $6.5 billion operating loss, mostly as a result of writing down many of its “investments”, including WeWork. It was SoftBank’s first quarterly loss in 14 years.
Thanks, Adam Neumann!