The Co-Working bounce-back

WeWork — and its investors — are betting that co-working still has a bright future.

Why it matters: Before the pandemic, the co-working revolution, led by WeWork, was well underway. Then suddenly, sharing desks and beer on tap with strangers became unthinkable.

What’s happening: WeWork is leaning even harder into its short-term, flexible office space offering.

• WeWork sold or shuttered a number of its side businesses to focus on its core co-working business.
• It cut costs by shedding some locations, including ones that hadn’t yet opened. 
• The company launched an on-demand booking service that’s basically Uber for offices. Anyone can download the app and book desk space or meeting rooms by the hour.

The big picture: WeWork’s new CEO, Sandeep Mathrani, “went into this and was like, ‘We do co-working, we do it well, so let’s just do that and make it profitable,'” says Alex Snyder, a real estate analyst at CenterSquare.

What they’re saying: “That archaic concept of a 20-year or 15-year lease doesn’t work anymore, but there was no impetus to change it,” says Peter Greenspan, WeWork’s global head of real estate. “What the pandemic did was accelerate the entire discussion from what could have taken another 30 years to a year.”

Worth noting: Even traditional real estate firms want in on the flexibility. CBRE recently bought a stake in the flex space firm Industrious.

What to watch: WeWork is in advanced discussions to go public via a SPAC.