2023-05-03 10:51:06 ET
WeWork ( NYSE: WE ) CEO and Chairman Sandeep Mathrani said on Wednesday the flexible office space firm is looking to other industries for the "next step" in developing its model.
He pointed to ride-share pioneer Uber ( UBER ) for potential lessons that could be applied to the office sector.
"Who would have believed that the medallions on the yellow taxis, which were worth millions of dollars, would be worthless today?" he said in a pre-recorded video to DLA's global real estate conference in Tel Aviv, the Jerusalem Post reported. "Uber created this disruption. The question is whether we can apply that concept of a shared economy to an office?"
Perhaps the office-space company can lease an office to one client for three days a week and to another client for the two days a week, he suggested.
"I think we will continue to evolve and once such an evolution begins, it happens very quickly and will catch traditional property owners off guard," he said.
The office real estate sector is rapidly changing as tenants push for shorter-term contracts. Traditionally, property owners signed leases for 10 to 20 years, like bonds, which made it easy to trade the assets, Mathrani said. But that bond-like feature has vanished because contracts are so short, he added , making the office space model closer to that of an apartment or hotel.
WeWork stock gained 0.4% in Wednesday morning trading.
More on WeWork:
- WeWork venture said to default on $240M loan for San Francisco office building
- WeWork stock climbs after reaching capital, debt pacts with bondholders
- WeWork stock fluctuates after soft Q1 guidance, Q4 revenue roughly in-line
For further details see:
WeWork CEO looks to Uber for next step in office-leasing model - report