WeWork Loses Bid for One WTC Office Lease

NEW YORK CITY—Last week multiple news sources had reported that WeWork was negotiating to lease approximately 220,000 square feet at One World Trade Center. The tallest tower of the iconic downtown site is owned by the Durst Organization and the Port Authority of New York and New Jersey.

WeWork’s negotiations to rent from seven to up to a dozen floors at One World Trade Center have fallen through. The news of this latest development was first reported in the Wall Street Journal.

“We could not accommodate WeWork due to the demand from other tenants for the same space,” Jordan Barowitz, VP of public affairs at the Durst Organization, tells GlobeSt.com. He also notes that those interested in the space were not current building tenants.

The Wall Street Journal had reported that Durst had received “more competitive numbers” from some media and technology companies, according to its chairman, Douglas Durst.

The article said Servcorp, another co-working space provider and building tenant, had a clause restricting competitors from taking out leases. But the paper stated Durst said they were discussing a workaround. In addition, the paper noted the tower’s security requirements caused a wrinkle as WeWork members are allowed to access multiple locations.

Those were not causes of the why the lease was not agreed upon, according to Barowitz. He says company employees with access to different buildings is not unusual and the World Trade Center tower’s security measures were not an issue.

Barowitz adds it’s quite common for landlords and tenants to have talks which do not necessarily materialize in leases. However, the WSJ had reported that a source close to the transaction said the “sudden collapse” of the negotiations took WeWork by surprise.

Arif Shah, the senior director of corporate communications at WeWork, provided the following statement to GlobeSt.com:

“The World Trade Center is an iconic building and one in which we take a keen interest. We have, and continue to, explore opportunities to secure a location there and believe we will be an energizing force for the building.”

If WeWork had inked the deal, it would have become the largest private occupier of office space in Manhattan, exceeding JPMorgan Chase which occupies 5.2 million square feet.

WeWork was founded less than a decade ago, in 2010. Earlier this summer, the company was raising funds at a $35 billion valuation. Last summer, the relatively young enterprise received attention when Softbank invested $4.4 billion in the company. Softbank allocated $3 billion directly to WeWork and $1.4 billion to three of its subsidiaries in Asia.