WeWork to Bankruptcy Judge: Keep Our Tenants Private

WeWork stands to reap the benefits of bankruptcy, but now seeks to avoid the downside: disclosure of its tenant roster.

The beleaguered co-working company is seeking to keep the names of its tenants private during the bankruptcy proceedings, Crain’s reported. While some tenants are known to the public through news reports and other disseminations, the company counts more than 600,000 customers worldwide.

In a filing, WeWork’s lawyers said the information could be used by rival companies to poach tenants with “unimaginable precision.” But the lawyers have clearly imagined it. Over the weekend, they said the release of the customer list would provide an “unfair advantage” to competitors.

WeWork’s lawyers said rivals are soliciting WeWork tenants of the company’s various offices.

The Department of Justice opposes WeWork’s privacy request. The trustee monitoring the case on behalf of the agency said there’s no compelling reason to conceal tenants’ names. Public disclosure is a tenet of bankruptcy law, the trustee noted.

A hearing on the matter is scheduled for Wednesday.

WeWork’s bankruptcy filing gives the company leverage to exit leases without paying the costly termination fees it agreed to at signing, and to pare down its various debts.

The case figures to offer more twists and turns.

Last week, attorneys representing WeWork landlords including Boston Properties, Brookfield Properties and Starwood Capital objected to WeWork’s debtor-in-possession financing, which would come from SoftBank.

Landlords have also objected to WeWork’s restructuring plan, which has already seen the company shed more than a fifth of its 300 leases. More cuts are likely coming. The company has 210 days from its Chapter 11 bankruptcy initiation to cancel and rework leases.

WeWork is incentivized not to upset its landlords, as maintaining good relationships with them is critical if WeWork is to emerge from its deep financial hole. At the same time, it needs to drastically reduce its rent obligations to become a viable business.

— Holden Walter-Warner