WeWork SA accelerates expansion despite global bankruptcy
WeWork South Africa says it has not been impacted by WeWork’s Global’s planned Chapter 11 bankruptcy filing in the US.
According to a Reuters report, citing sources, the shared workspaces companyplans to file for bankruptcy as early as next week.
The SoftBank Group-backed WeWork has been struggling with a major debt pile due to being hit with low returns after significantly declining demand from clients.
Tenants of the troubled company across the globe either cancelled their lease agreements, or refused to pay rent, after the pandemic hit.
After suffering severe setbacks due to the impact of COVID-19, WeWork −once valued at $47 billion − announced a restructuring process in 2020, which it said impacted more than 1 000 staff members.
In a statement, WeWork South Africa points out that as an entirely separate entity 100% owned byco-working spaces company SiSebenza, it is not affiliated with WeWork Global.
Andrew Robinson, executive director, and Stefano Migliore, CEO of WeWork South Africa, confirm that global developments will not affect operations in SA.
"Since SiSebenza acquired WeWork South Africa in March this year, our focus has been on expanding the WeWork brand in Ghana, Kenya, Mauritius and Nigeria, and growing our presence in South Africa. Our business's core elements remain strong, and our primary objective is to achieve growth and sustainability."
Following the acquisition, the pan-African real estate investor gained exclusive rights to operate WeWork’s existing locations in SA, and further grow and operate the WeWork franchise in Ghana, Kenya, Mauritius and Nigeria.
In September,WeWork South Africa announced a significant expansion of its Cape Town office. It said it would accommodate more than 250 new clients, with the addition of an extra floor.
Besides the Cape Town location, WeWork also has office buildings in Rosebank and Sandton in Johannesburg.
In addition to the current economic upheaval, the global company has over the past few years been dealing with an ongoing lawsuit against its funder SoftBank, over a cancelled $3 billion tender offer.
In January, the company reportedly announced another round of retrenchments, noting it would cut 300 jobs globally, in efforts to reduce costs.