Quote:
Originally Posted by VivaLFuego
I do enjoy that all of you real estate guys are getting woke now that the SV techbros are "disrupting" your industry... eventually a sufficient swath of national public opinion will turn against this entire class of rent-seeking a-holes wasting an entire generation's greatest creative human talent on valueless endeavors.
|
I'm not a real estate guy, but the fact that they are losing $5200 per 'office' worker who comes in the door on average per year is pretty crazy. They should have a clear path to profitability too - though I admit I haven't read all of the IPO document but I understand enough based on what I've read and what my friends have told me. If they are leasing their space in a building at $X/square foot, then they should be figuring out what the margin is to break even $X+$Y/square foot. The fact that they owe literally BILLIONS in back rent to me at least is pretty crazy and shows that they are either charging too little for their rent relative to what they're paying and all the other overhead such as employee costs. How do they expect to pay all of this back without it adding up even more and then start to turn a profit? It's going to take awhile or they're going to have to start jacking up the rent on their existing clients, which isn't going to be appreciated by many of them.
Not only that, but they had a net loss of nearly $2B last year. Also not to mention that there's similar companies out there like IWG with actually more square footage than WeWork that actually have net income and had more revenue than WeWork...but are valued at something like 1/15 of what WeWork is valued at. WWC is severely over valued.
I'll be shorting their IPO. It's a great idea but WWC is not even close to the shining example of companies who can actually turn it into a profitable business. If you want that, look at companies like IWG. This whole thing to me just screams that they're trying to raise money to pay back some of the tons of rent it owes..except they still have an actual spending type of problem that will continue even with an IPO.
https://markets.businessinsider.com/...9-8-1028460674
Also, the CEO is doing some shady stuff. He's bought real estate and then leased it to his own company he's the founder/current CEO of, pocketing the $$$.