WeWork Lease Rejections Leave $2.5 Billion CMBS Exposed
- As much as $9 billion in bonds exposed to firm, Barclays says
- Moody’s says New York, San Francisco markets could be damaged
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WeWork Inc.’s plan to terminate leases on at least 69 properties will add to the mortgage bonds affected by the coworking company shuttering locations, raising that total to $2.5 billion. And much more debt is potentially at risk.
WeWork, once valued at $47 billion, needs to slash costs and shore up its finances as it tries to continue operating. Filing for bankruptcy positions the company to break leases, exposing property owners to more empty space at a time US office markets are already reeling from rising vacancies and struggling to repay debt.