Photographer: Caitlin Ochs/Bloomberg

What Life Is Like Inside WeWork’s Communal Housing Project

WeLive is a meticulously crafted yuppie paradise. So why is the business stalling?

It’s been a year and a half since August Urbish first stepped into the lobby of the WeWork Cos. housing community on Wall Street, and he says the experience has completely changed him. His fully furnished apartment is located five floors above WeWork’s shared office spaces in a section called WeLive. In the common areas, Urbish and hundreds of other residents can cook dinner in an expansive kitchen, shoot pool in the laundry room or get neighborly over free WeWork-provided cocktails on the seventh-floor roof terrace.

Since starting his “We” life, Urbish quit his job at a Manhattan art gallery to develop a Twitter-like app for sharing jokes. The 34-year-old has increased the number of friends he would invite to his future wedding, if he ever gets married, to more than 40 from seven. He credits WeLive with helping him to not be “such a spaz.” Although he doesn’t immediately advertise it, Urbish is such a model citizen that WeWork cuts him a discount on his rent to be an official ambassador for WeLive, a nascent business within one of the world’s most valuable technology startups and the subject of this week’s episode of the Decrypted podcast. “It’s done wonders for my confidence,” Urbish says. “I’ve already kind of forgotten how it was to live not at a WeLive.”

WeWork was founded in 2010 by a pair of American and Israeli entrepreneurs who grew up on communes on opposite sides of the world. They began by leasing office space and renting desks to New York’s creative set. WeWork has since opened locations in more than 50 cities around the world, amassed investments valuing the company at about $20 billion and last week bought the iconic Lord & Taylor building on Fifth Avenue. WeWork wants to parlay its success with co-working into a “We” lifestyle brand that incorporates not just work but living and wellness for community-minded people.

A WeWork employee, right, checks the common kitchen area.
Photographer: Caitlin Ochs/Bloomberg

The first two WeLive buildings, in New York City and near Washington, D.C., debuted early last year to high expectations: WeWork executives had previously told investors that WeLive would soon become a significant part of the business, buoyed by young people’s desire for community well past the college years. WeWork expected to have almost three dozen WeLive locations by the end of this year, according to a 2014 investor presentation published by BuzzFeed. It still only has two.

WeLive stalled for several reasons. For one, it offers little in the way of discounts over a traditional apartment, with studios starting at $3,050 per month in the New York location. Despite the raves of fans like Urbish, other current and former residents say the building isn’t well run for the price and that they were turned off by the communal offerings. Some critics describe it as a dorm for adults.

Jim Woods, the head of WeLive, says finding the right properties has been a challenge but that WeWork is committed to the business. The company plans to open a 36-story tower in Seattle by 2020. Twenty-three of its floors will be WeLive. In the meantime, WeWork is quietly exploring other options besides long-term apartment rentals. Both WeLive locations provide corporate housing to employees of big companies that use WeWork for office space, Woods says. WeWork also offers units in New York by the night to the public like a hotel. So I decided to book a room and meet the people inside—like Urbish, who I encountered on my first day there. I wanted to find out whether everyone at WeLive was as devout as Urbish and whether WeWork might be able to reinvent the home in the same way it aspires to do for the office.

Two members of WeWork enjoy the ping pong and laundry common area of the WeLive building in Manhattan.
Photographer: Caitlin Ochs/Bloomberg

 

WeLive Wall Street is in a 27-story building that was wrecked by Hurricane Sandy. After it was cleared for repairs, WeWork converted the first six floors into offices and used the rest for its housing experiment. The once-flooded ground floor now houses a Momofuku Milk Bar, and the basement is a nightclub called the Mailroom, a name given in part because it actually handles WeWork’s mail and in part so it can call one of the $14 cocktails the Pen Pal.

I check in at the front desk and chat with another guest staying for a few nights. She runs retreats in remote parts of the globe for customers looking to use peyote and other psychedelics to achieve personal enlightenment. I had booked a $233 a night Studio Plus unit but get upgraded to a one-bedroom on the 15th floor, complete with a fridge, kitchenette, television and couch. WeLive apartments are designed for people to be able to move in with just a couple suitcases, whether for a few nights or a year. Mine includes the kind of touches that someone could safely expect me to like based on my age (27) and social milieu (privileged, coastal professional)—a Tuft & Needle mattress, Brooklinen sheets, two patterned accent throw pillows and an illustrated print of succulents on the wall.

I drop my bags and explore the rest of the building. It’s organized into sets of three floors, called “neighborhoods,” connected by an internal staircase. Each neighborhood has a different wallpaper motif, and several feature boozy themes. The 15th floor, where I’m staying, has a framed poster that reads, “Tequila is my spirit animal.” On the 11th floor, just outside the elevators, an anti-prohibition headline is painted on the wall in letters more than a foot tall: “New York celebrates together / 14 year dry era ends today, December 5th, 1933.”

Black mugs in the apartments urge tenants to “Live Better Together,” and the housekeepers pushing carts down the hallways wear black T-shirts that read, “Do What You Love.” Both are WeWork slogans. Some of the décor is best viewed at a distance: The record player on the eighth floor is never plugged in, and thousands of books in the building’s lounges have red $1 sale stickers on them from the Strand, a venerable New York bookstore.

August Urbish chats with friends behind the bar during happy hour.
Photographer: Caitlin Ochs/Bloomberg

While waiting for the elevator, screens show upcoming fitness classes and advertisements for a WeWork-operated grant program that cuts checks to entrepreneurs. I notice an announcement for a WeLive happy hour on the 10th floor. When I get there, Urbish is behind the bar wearing a backward baseball cap, flipping cocktail shakers and serving margaritas. More than a dozen people come by—Urbish had sent out a “buzz” on the WeLive app letting guests know that WeWork would provide herbed French fries and chicken nuggets.

Urbish greets almost everyone at the happy hour. He has lived in the building since its earliest days, when it was a group of “beta” residents who were mostly WeWork employees and their friends. Last year, WeLive emerged from beta by hiking prices in the building, which prompted some public criticism. Urbish saves a little money by serving as a WeLive ambassador, one of 15 or so residents who gets a discount on rent in exchange for hosting events in the building and generally being a friendly resource. Even after the credit, Urbish’s rent for the four-bedroom apartment he shares with three roommates is no cheaper than a comparable place on Wall Street, he estimates.

WeLive started the ambassador program about six months ago and the daily happy hours in the last couple months, hoping to encourage that intangible sense of community. On Saturday evening, when a group of residents tumble out of their room and toward the elevator, they spot me and extend an invite to a bar down the street. I join them for beers served in Styrofoam cups under a ceiling covered in bras. There, I learn one of them is an ambassador, too.

Posters line a hallway.
Photographer: Caitlin Ochs/Bloomberg

 

On Sunday morning, I sit down with Urbish in a pair of hot pink chairs in the hallway. I get the sense that he would host the happy hours even if he didn’t get a rent discount for doing so. He lived in New York for eight years before WeLive, and he says it always felt isolating. “New York is super crowded, but I was walking around in a little bubble trying to stay out of everyone’s way,” he says. “I didn’t think that I needed any more friends. And now that I have so many, I’m a little disappointed that I lived so long without them.”

But several other tenants haven’t felt the same passion. “This is a worry-free space, almost disposable,” says one resident, who’s on a month-to-month lease while figuring out his next career move and asked not to be identified to avoid publicizing where he lives. “It’s a bubble.”

Later that night, I meet up for tea with someone who had moved out a few months ago after living there for a year. She asks not to be named for fear of potential backlash from her former landlord. She and her roommates were frustrated with mail consistently arriving late, hot water unexpectedly going out and misleading statements from the company about the size of their closets, she says. The communal aspect had initially intrigued them, but once inside, the extended college lifestyle became exhausting. “We would occasionally be like, ‘Oh, it looks like something is happening on the rooftop! Want to go? Not really.’ We just didn’t go,” she says. “It’s a great place to be if you’re just moving to the city, and you want to meet people, or you need a place for a couple months before you find your real apartment.”

Most of the WeLive residents I meet have an entrepreneurial bent. Tenants are building esports leagues, glass smartphone cases and a healthy cooking app. During the day, some work from the spacious ninth-floor kitchen, and many go to WeWork offices. Most draw the line at working from the office space downstairs to achieve some degree of WeWork-life balance.

WeLive is a networker’s paradise. Urbish used some cash from side gigs doing video production and art consultation to hire two neighbors, who are helping help him build his joke-sharing app. He describes it as the funny parts of Twitter without Donald Trump. He was inspired to work on it after a chat in the laundry room with Raviv Nadav.

Raviv Nadav at his apartment in the WeLive building in Manhattan.
Photographer: Caitlin Ochs/Bloomberg

Nadav, a 32-year-old from Israel, has a similarly enthusiastic take on daily life at WeLive. Nadav isn’t an ambassador, but he likes to host parties in the two hot tubs on the roof deck and salsa-dancing lessons for his fellow residents. He splits a $5,000 a month one-bedroom unit with two other men. One gets the bedroom; another sleeps in an alcove bed; and Nadav is on a bed in the living room. Despite the cramped quarters, Nadav is a We devotee. “I get this amazing quality of life,” he says. “The only thing I lack is a door and a wall.”

 

Although catering to residents like Urbish and Nadav is WeLive’s “primary goal,” says Woods, the company is turning to alternative revenue sources to make up for slow growth. In the past two years, WeWork explored deals to open WeLives at two different New York City locations—one in Chelsea, another in Long Island City—where zoning regulations bar residential use, according to people familiar with the matter. The moves suggest WeWork is weighing a deeper expansion into short-term rentals, which could put it into closer competition with a recent partner, Airbnb Inc.

WeWork started testing a program last month to let Airbnb guests in six cities save spots at co-working offices nearby. If WeWork pursues more short-term rentals, the company could benefit from how Airbnb legitimized unconventional travel accommodations, says Arun Sundararajan, a professor at New York University who wrote a book about the sharing economy. But WeWork is still working out kinks. I was able to book a room for five nights on a floor that forbids rentals of less than a month, and some long-term residents live on floors zoned for hotel use. According to a WeWork spokeswoman, my unit and three others were made available as hotel rooms in error, and the company is working to correct compliance issues elsewhere. She declined to say how much of its business comes from hotel stays or corporate housing.

A bed tucked into an alcove off the dining room, inside a unit at the WeLive building.
Photographer: Caitlin Ochs/Bloomberg

Profit margins on hotel rooms are much higher than long-term leases, and there are plenty of travelers willing to pay for a unique experience in Manhattan. Tricia Eastman, the psychedelic retreat coordinator I met at check-in, had been considering the Ace Hotel, a boutique. Eastman, a 37-year-old from the Los Angeles suburb of Topanga, California, picked WeLive because she figured she’d prefer the crowd there. “I still consider myself ‘in’ with the late 20s, early 30s, into the 40s—younger, hipper crowd—and I wanted to be along with people that I felt were similar,” she says. “People that I would go have a drink with. And that’s not always the case when you stay in a hotel.”

On Monday, I pack my bags and prepare for the return home to San Francisco. While checking Instagram, I find a photo tagged to WeLive Wall Street by someone named Andrew Cutter. I get in touch with him, and he tells me he lived there for 14 months while starting a tech company. Cutter, 35, recently moved to a townhouse in Park Slope, Brooklyn, and says WeLive always felt temporary. “It was a place to exist for a while,” he says. “I had a bunch of artwork that I just never put up. They give you sheets; they give you pillows; they give you towels; they give you everything you need to live there. It’s interesting how little you’re going to change the place because everything is already provided.”

Cutter’s new place is not only cheaper but something he can make his own, he says: “It does feel a lot more like home, even after only a few weeks.”

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