No one could accuse WeWork of being overly sentimental.
The decade-old co-working company is shutting down its first-ever location as the firm overhauls its massive real estate portfolio, sources told The Real Deal.
The coworking space at 154 Grand Street was the first WeWork location co-founders Adam Neumann and Miguel McKelvey opened ten years ago on their way to launching the fast-growing company, which at its height was valued at $47 billion.
The two opened the 3,000-square-foot location in a space at the corner of Lafayette Street with creaky wood floors and exposed brick that they power washed clean – part of the early charm that drew many customers to WeWork.
But Neumann and McKelvey have left the company, and new CEO Sandeep Mathrani has been picking through the portfolio, trying to renegotiate leases with some landlords or get out of locations that don’t work.
The lease on the Grand Street space is expiring this year, and WeWork notified members it will be closing the space at the end of July.
“I am writing to let you know that after ten years our lease at the WeWork location at 154 Grand Street in Soho will soon expire,” a representative for the company wrote in a letter to members. “We have reflected on the past 10 years and the indelible mark this building has left on us, our community, and the company as a whole.”
The building’s owner, the Eretz Company, did not respond to a request for comment.
Being the first WeWork location, the Grand Street spot was built to early standards that no longer match the WeWork brand, a person familiar with the location told TRD. It’s also much smaller than the scale at which WeWork operates now, and the company has other locations in Soho to serve the market.
A spokesperson for WeWork confirmed the closure.
“In streamlining our portfolio towards profitable growth, we have decided to move on from 154 Grand,” the spokesperson wrote in an email.
The Grand Street closure is the latest move by WeWork to overhaul its real estate footprint following its botched IPO attempt last fall.
The company recently scrapped plans to move into a 115,000-square-foot Midtown South location where it signed a lease two years ago.
Earlier this year, WeWork hired brokers to try to negotiate concessions from landlords on locations that didn’t work economically. Some believe that if the effort isn’t successful, WeWork could end up filing for bankruptcy.
A new podcast series by Bloomberg Technology tells the story of WeWork, relying in part on recordings of private company meetings that show Neumann candidly. The first two episodes look at his time on a kibbutz in Israel and the early days of WeWork’s growth.
Contact Rich Bockmann at [email protected] or 908-415-5229.