It’s not all doom and gloom for WeWork these days. The co-working company has landed a big deal in Jersey City while also avoiding more liabilities on its balance sheet.
WeWork has leased roughly 110,000 square feet at Goldman Sachs’ 30 Hudson Street to be used as the global headquarters of Organon & Co., a planned spinoff of pharmaceutical company Merck, Business Insider reported.
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Organon, which will encompass Merck’s “women’s health, legacy brands and biosimilars businesses,” plans to conduct an initial public offering in the first half of 2021 and move into the space at that time.
One notable feature of the deal is that Merck, rather than WeWork itself, will serve as the guarantor of the lease. In its IPO filing last year, WeWork reported that it had $47 billion in lease commitments over the next 15 years, although only a small percentage was guaranteed by the parent company.
Goldman Sachs developed 30 Hudson Street in 2004, and it was the tallest building in New Jersey until 2018. In the early 2010s, as the expiration of a 10-year, $164 million abatement program it received for the development neared, the investment bank began transferring employees from the property to its Battery Park City office.
WeWork executive chairman Marcelo Claure said in a recent interview with the Financial Times that the 10-year-old company is now on track to turn a profit by the end of 2021. [BI] — Kevin Sun