WeWork Rebound? Shared office leases hit post-pandemic high
by Paul Davenport Paul Davenport on

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Many businesses were forced to reinvent themselves in response to the pandemic. WeWork, on the other hand, is a business that’s poised to succeed post-pandemic despite it’s attempts at reinvention.

In April and May 2021, the company recorded its highest net desk sales (ie. new licenses versus cancellations) since September 2019, when WeWork was originally poised to launch a blockbuster IPO only to see its prospects tanked by leadership conflicts (and some very, very bad press).

Fast forward to Summer 2021, and the entire premise of a main office has shifted in WeWork’s favor, as companies offload their own real estate holdings having seen the virtues of remote work play out during the pandemic. Hybrid work and Work-From-Anywhere setups are now not only viable via coworking spaces like WeWork, but they are the preferred strategies for workers too, as roughly 80 percent of knowledge workers want a flexible remote work schedule going forward.

As a result, WeWork has seen it’s occupancy rate reach 53 percent over April-May; a far cry from the company’s peak of roughly 70 percent occupancy, but a very healthy figure for a brand that had to rapidly weather a major corporate restructuring.

“The pandemic has fundamentally changed the way people work, accelerating the demand for flexible workspace among organizations of all sizes,” Julia Sullivan, a spokesperson for WeWork, said in a statement. “Over the last year, WeWork demonstrated the resilience of its business model and emerged as a partner of choice for businesses large and small looking for flexibility as they return to work.”

Restructuring for a Work From Anywhere future

WeWork was originally founded in 2010 as a new kind of shared workspace, offering chic settings and loads of office perks that few corporate HQs could match. While renting out conference rooms or desks for smaller upstarts or entrepreneurs was hardly a new practice, no other business was able to expand that strategy to the enterprise at scale quite like WeWork.

While the company’s rapid ascension to the top of the shared-office market was perhaps misguided (resulting in lots of litigation and executive payouts), WeWork is emerging from the pandemic with a new attitude—and, thankfully, a fresh business strategy.

While the offering itself looks much the same (gorgeous shared office space with more food, games and other perks than folks can count), the company cut overhead costs by $1.1 billion and trimmed $400 million in operating expenses over the past year under new CEO Sandeep Mathrani. Part of this restructuring included exiting 106 underperforming markets and negotiating more than 100 lease amendments to ensure the company stayed afloat while everyone was forced to work from home over the course of 2020.

The WeWork of today is now a much more nimble company with far less real-estate baggage, but it’s safe to say that the changes are still only getting started.

For instance, while WeWork had started as a great avenue for smaller tenants without the cash or staff to sign traditional long-term office leases, the company is seeing a lot of its current growth coming from larger enterprises, as many look to keep entire departments semi-remote for the foreseeable future.

So what does this all mean for the enterprise IT teams managing end-user experience for staff logging on from a WeWork?

On the one hand, workers will have more consistent access to commercial-grade Internet connectivity when they log on from a shared office than if they logged on from home, like most had during the pandemic. That said, users will likely be on WiFi and sharing that Internet connection with everyone else at the WeWork, regardless of whether they work for the same company or not.

IT teams need to ensure that the devices their remote workers use to access the network are instrumented to safely and effectively promote productivity from wherever users log on. That goes beyond establishing VPNs or edge technologies; it entails establishing visibility across all network connections, from the corporate data center to the cloud to the individual user or team.

With this visibility in hand, enterprise IT teams can better understand when applications aren’t performing, who’s at fault (bad Internet at a WeWork? Or does it fall on the SaaS provider?) and a timely strategy to fix potential issues and hold responsible parties to task for bad performance.

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Filed Under: Industry Insights

Tags: network visibility, network performance monitoring, network management, remote network, remote workforce, remote monitoring, enterprise network, enterprise IT, future of work, coworking, flex schedule, flex office, work from home, work from anywhere, remote work, hybrid work, hybrid office, shared office, wework

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