WeWork, a multinational flexible workspace company, has reported slower cash collection rates and engagement with its members on payment deferral programs due to Covid-19.
In the ‘events after the end of the reporting period’ section of its recently published results for one of its Irish subsidiaries, WeWork Community Workspace Ireland, the company described some of the effects of the Covid-19 pandemic at a time around the world and in Ireland. The results covered 2019.
He also pointed out he had taken measures to mitigate the operational and financial impact of Covid-19 through âproactive negotiations with owners using a location-by-location approach for postponements and reductionsâ both in Ireland and worldwide . He added that WeWork’s goal is to create a “leaner, more efficient organization.”
In the section, the affiliate also reported that across WeWork’s Space-as-a-Service locations in Ireland as a whole, it had generally experienced âbelow historicalâ occupancy levels. It also reported a reduction in sales volumes both at its existing and new sites.
Other issues identified in the section include slower-than-historical cash collection rates, reduced credit terms with some vendors, and increased member discounts. He added that WeWork had “engaged with some members in Ireland regarding the payment deferral programs related to Covid-19.”
Last May, the Independent Sunday reported that a group of Dublin-based WeWork tenants had formed to negotiate rent payments.
It is understood that the group became frustrated with the US-based owner’s response to their individual rent concerns at the onset of Covid-19. WeWork has reportedly offered rent deferrals to some of the companies.
At the time, sources said the group was not happy with the offer and joined to discuss their rent issues with WeWork. A source said WeWork refused to negotiate with the group.
WeWork is believed to have engaged individually with group companies as it is unable to discuss their private contracts collectively.
According to reports from last May, WeWork had four open buildings and 7,000 members in Dublin.
A spokesperson for WeWork said the results were for a holding company that exists primarily to manage intercompany revenue and payroll and administration costs for its Irish operations. She said the results therefore “did not represent the performance of our Irish business”.
âLike all businesses in the world, we are working to deal with a global pandemic,â she added.
âOur proactive steps to mitigate its impact and our early efforts to become a more streamlined, money-conscious organization put us in a strong position to adapt quickly and navigate new realities. This not only gave WeWork the ability to continue to innovate on our product, but it also kept the company on the path to profitability. “