WeWork is keeping its focus on larger, so-called “enterprise” tenants who provide long-term stability, steady revenue and fill more space.
In its latest deal, the co-working firm signed lifestyle products membership service FabFitFun to 55,000 square feet at WeWork’s space in the Pacific Design Center’s Green Building, according to the Los Angeles Business Journal.
The new FabFitfun headquarters will occupy an entire floor at the West Hollywood complex at 8678 Melrose Avenue, according to the report. WeWork leased that space from owner Cohen Brothers Realty in 2018.
The recent deal is the largest sublease WeWork has closed in L.A. It comes as the pandemic has accelerated the co-working firm’s shift to larger tenants, a move CEO Sandeep Mathrani outlined last year.
WeWork’s Green Building location has large common spaces and amenities that include podcast studios, styling suites, photo and casting studios, director studios, and a classroom, according to the report.
The Pacific Design Center’s Red, Green, and Blue buildings were built in different decades and total 1.6 million square feet. During the initial months of the pandemic, WeWork shuttered its 120,000 square feet at the Green and Red buildings — WeWork also has a lease for 69,500 square feet at the Red Building through 2030, making it the largest tenant there.
Over the past year and a half, WeWork has weathered a failed IPO, a change of leadership and the pandemic, which led to a sharp dropoff in small subtenants.
In 2020 alone, the company lost $3 billion and continued to close spaces in early 2021.
Things may be on the upswing, however. The company is looking to go public again, in a $9 billion deal through a special purpose acquisition company.
[LABJ] — Dennis Lynch