Fishing buoys line the communal bar in the WeWork co-working space in Seattle’s Ballard district. (WeWork photo)
WeWork is closing its location in the Ballard neighborhood of Seattle less than two years after opening its office as the office-sharing company restructures its real estate presence amid the ongoing effects of the COVID-19 pandemic.
In an email received by GeekWire on Monday to at least one tenant at 1448 NW Market St., WeWork set a move-out date for just over a week from now, June 16.
“As you may know, WeWork has been conducting an in-depth review of our global real estate portfolio over the past few months to optimize our assets and operations around the world,” stated Robin Cardoso, NW. signed Email Area Director and Cody Morrison, NW Portfolio Director. “As we work to strengthen our presence, we look forward to moving you and your team to a nearby WeWork area.”
A company spokesman declined to comment on GeekWire about the Ballard closure, how many tenants are currently using the space, or whether other locations in the Seattle area may be closed.
This unexpected exit is a step backwards for Ballard in order to establish itself as a residential and work district for many in the technology industry.
Eric Schudiske, founder and CEO of s2s Public Relations and Communications, said the news was “completely unexpected” and he was surprised by the brief news. He had just signed a six-month lease for a four-person office on site in March.
“It really is a shame for Ballard that high-quality modern office space deserves,” said Schudiske. “This unexpected exit is a step backwards for Ballard to establish itself as a neighborhood where many people in tech work and live.”
Schudiske said he used the space during work hours and while his team was mostly working from home, up to three s2s employees would work from WeWork about once a week.
WeWork’s website lists 10 more office-sharing locations in the Seattle area, including seven in the city and three in nearby Bellevue, Washington – about half of what opened or planned to open in the area in 2019.
WeWork opened in December 2019 in a new building on the corner of 15th Avenue NW and NW Market Street in Seattle. (WeWork Photo)
WeWork in Ballard opened in December 2019 in a new development next to Target, Poliklinik and Equal Exchange Coffee. The 76,500 square meter area extended over two floors and the decor played out the maritime roots of the district.
Founded in 2010, New York-based WeWork saw dizzying growth as it rode the tech boom with locations opening around the world. According to its website, it now has more than 800 locations in 118 cities.
For most of his life, it has been about providing small, flexible office space for startups and companies that weren’t ready to commit to a permanent office. As of 2019, WeWork’s fastest growing business was large corporations with 1,000+ employees.
But WeWork saw a spectacular drop in valuation from $ 47 billion to $ 8 billion in late 2019 after investors resisted its financial metrics while planning an IPO. Co-founder and CEO Adam Neumann was ousted and the company laid off thousands.
The arrival of the pandemic cast doubt on the future of coworking spaces as people withdrew from offices to work from home. Seattle-based startup The Riveter, which wanted to build a national network of women-centric coworking spaces, closed all nine locations in May 2020 due to ongoing workplace insecurity.
WeWork reported a net loss of $ 2.06 billion for the first quarter of this year as it was affected by restructuring charges, Reuters reported on May 20. The company said it had 490,000 members in the first quarter, compared to 693,000 in March 2020.
WeWork has now agreed to merge with the special purpose vehicle (SPAC) BowX Acquisition Corp. to go public. The deal values WeWork at $ 9 billion.
The Associated Press reported in March that, despite the impact of the pandemic on where and how people work, WeWork is still poised to succeed as the economy recovers. The company predicts total membership of 1.5 million by 2024.
WeWork in Ballard. (WeWork photo)
After opening its first Seattle office at 500 Yale Ave. N. in 2013, WeWork expanded rapidly in the area, reaching 1.7 million square feet of leased office space in March 2019. The presence made WeWork one of the largest office space users in the Seattle area alongside Amazon, Microsoft and Boeing.
By October 2019, the company had opened or announced 22 locations in Seattle.
Jon Slavet, managing director for the west of WeWork, told GeekWire in August 2018 that Seattle is a “bright shining star” for the company and that this region is one of the most dynamic markets in the world. He cited a combination of some of the fastest growing companies in the tech industry and an ever-growing list of companies out of town in need of space immediately.
Despite its success in the region, WeWork has canceled plans for a WeLive co-living housing project in a 36-story building in Seattle’s Belltown neighborhood. The plans for the Third & Lenora building to be developed by Martin Selig Real Estate envisaged 384 apartments and 200,000 square meters of co-working space, in addition to community and retail space and a 5-story parking garage.
The email to Ballard tenant Schudiske this week said that WeWork could offer him and his team space nearby and that WeWork would offer moving services.
But Schudiske told GeekWire that he is moving to the Washington Maritime Blue Incubator in nearby Fisherman’s Terminal.