Difficulty sharing? Coworkrs sues Lyft over FiDi office deal

Shared-ride startup allegedly reneged on one-year lease at 60 Broad

New York /
Dec.December 29, 2016 04:14 PM

UPDATED, 6:37 p.m., Dec. 29: It’s underdog versus underdog in this office-lease spat.

In a lawsuit filed Wednesday in New York State Supreme Court, WeWork rival Coworkrs alleges that struggling ride-sharing startup Lyft tried to renege on a one-year lease at 60 Broad Street in the Financial District.

According to the suit, Lyft agreed to lease 23 desks and two conference rooms from Coworkrs for $17,527 a month — which ended up being $175,527 for the year after Coworkrs sweetened the pot with several discounts.

But it didn’t take long for the San Francisco-based ride-sharing company to try to back out of the contract it signed in November, Coworkrs claims. It says Lyft first downsized its space and later sent two lease termination letters. In the second letter, Lyft accused Coworkrs of turning over confidential information to the companies’ shared broker at Cushman & Wakefield, which it said represented a violation of the lease terms.

Coworkrs denied sharing confidential information, but said it contacted the agent to disclose that Lyft was taking a smaller space, and that the agent’s commission would be adjusted accordingly.

The co-working firm says Lyft’s claim was made to hide the fact that it’s underperforming in the New York market and needed to reduce expenditures.

In a statement, Alexandra LaManna, a spokesperson for Lyft, said, “This is a blatant attempt by CoWorkrs to distract from their own breach of an agreement by making negative insinuations about Lyft’s market viability and extract leverage where there is none. We will defend ourselves vigorously against these baseless allegations.”

A spokesperson for Coworkrs declined to comment on pending litigation.

Both venture-backed startups are dwarfed by their respective industry rivals.

Coworkrs, founded in 2012 by CEO Shlomo Silber, has five locations in New York City compared to WeWork’s 36. (Coworkrs has 40,000 square feet at 60 Broad and it recently took on another 30,000 square feet in Bushwick.) As for Lyft, the company has raised $2 billion from investors to date — a far cry from Uber’s $8.7 billion.

But while Coworkrs seems to be growing — Silber told TRD in May it was looking to raise $20 million to expand in the Northeast— Lyft has struggled to gain traction in a market saturated with ride-sharing competitors like Via, Gett and Juno.

This summer, the Wall Street Journal reported that Lyft had hired an investment bank known for helping tech companies find a buyer.

In October, Lyft’s co-founder and president John Zimmer denied the company was for sale, and said Lyft had doubled its ridership to 17 million rides since a year earlier. Lyft has $1.3 billion in the bank out of the $2 billion it has raised from investors, Zimmer said at the time.


Related Articles

arrow_forward_ios
Silverstein leashes BarkBox for 52K sf at 120 Broadway
Silverstein leashes Bark for 52K sf at 120 Broadway
Silverstein leashes Bark for 52K sf at 120 Broadway
Broad Street Development, Invesco refi 80 Broad for $150M
Broad Street Development, Invesco refi 80 Broad for $150M
Broad Street Development, Invesco refi 80 Broad for $150M
Daniel Boulud and the Beekman Hotel (Getty, GKV Architects)
Daniel Boulud replacing iconic Augustine with new French bistro
Daniel Boulud replacing iconic Augustine with new French bistro
WhyHotel opening living space at Rudin’s 110 Wall Street
WhyHotel opening living space at Rudin’s 110 Wall Street
WhyHotel opening living space at Rudin’s 110 Wall Street
Ron Burkle’s $155M play on Wall Street: American Stock Exchange HQ
Ron Burkle’s $155M play on Wall Street: American Stock Exchange HQ
Ron Burkle’s $155M play on Wall Street: American Stock Exchange HQ
195 Broadway in Manhattan NYC, Orchard Technologies CEO Court Cunningham and L&L Holding Company CEO David Levinson (Google Maps, Orchard, L&L)
Orchard Technologies leases 107K sf at L&L’s 195 Broadway
Orchard Technologies leases 107K sf at L&L’s 195 Broadway
Clay Grubb (Glen Lennox, Getty)
Grubb Properties tests affordable housing model in NYC
Grubb Properties tests affordable housing model in NYC
Vanbarton pitches Financial District office tower as resi conversion
Vanbarton pitches Financial District office tower as resi conversion
Vanbarton pitches Financial District office tower as resi conversion
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...