WeWork documents reveal it owes $18 billion in rent and is burning through cash as it seeks more funding

WeWork, the office-leasing startup, is looking to raise more funding through its first bond sale for $US500 million, despite already raising billions in venture capital from backers such as SoftBank.

The coworking giant disclosed startling underlying numbers for its business in its bond-sale documents such as its $US18 billion rent bill. The company has more than 1.3 million square metres of office space, with suitably massive lease obligations; but if unable to pay those bills, WeWork has the option of closing locations.

WeWork’s revenue from memberships more than doubled last year, to $US822 million, but expenses rose faster, to $US1.81 billion. Net losses reached $US934 million, according to Bloomberg.

There are worries that WeWork is overly exposed to market shifts that could affect the willingness of its occupants to pay membership fees. On the other hand, the positive view is that the company’s leases will eventually generate more cash than its expenses as occupancy rates rise.

Image and article source: https://www.businessinsider.com.au/wework-500-million-bond-sale-financials-analysis-2018-4?r=US&IR=T

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