Coworking giant WeWork is navigating its bankruptcy restructuring with significant cost-cutting measures. The company has been renegotiating more than 60 leases across various cities, saving a whopping $1.5 billion in future rent payments.
One such lease involved the 14-story Midtown Center in downtown Washington, D.C. Discussions with Carr Properties — the current owners of the property — revolved around rent reduction of its original 110,000 square feet within the building.
In its bankruptcy filings, WeWork listed Carr Properties as one of its biggest unsecured creditors with some $3.6 million worth of pending debt as of November. As part of the new deal, WeWork agreed to pay back nearly $589,000 in unpaid rent at Midtown Center.
For now, Midtown Center (located at 1100 15th St.) is the only remaining WeWork location in D.C., although the company has filed motions to retain two others — The Wilson at 7272 Wisconsin Ave. in Bethesda and Arlington Gateway at 901 N. Glebe Road.
However, Carr Properties has its own reason to keep WeWork at its 15th Street location: The property’s anchor tenant, Fannie Mae, is rumored to ready itself for an exit in May 2029. Losing the loan provider would pose a significant challenge as it would vacate a massive, 720,000-square-foot slot within the 865,000-square-foot building.
Carr Properties acknowledged WeWork’s value, stating: “WeWork’s workspaces offer access to premier buildings with desirable amenities for businesses of all sizes in the D.C. region.”
“While flexible work has dramatically transformed D.C. in recent years, desire for workspace in the center of the action is strong,” WeWork Global Real Estate Vice President, Kate Harper, said in a press release. “This new agreement cements our long-term partnership with Carr Properties and our commitment to the capital, positioning WeWork to deliver solutions that power D.C.’s entrepreneurial and business community for the future.”
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