WeWork’s bankruptcy has put an end to the era of ostentatious coworking spaces that were loaded with extravagant amenities such as climbing walls, live DJs, and swimming pools, according to Jamie Hodari, CEO of Industrious, a rival flexible-workplace company.
Hodari revealed that many of WeWork’s locations will transition to new operators following the bankruptcy, and the opulent office spaces with luxurious amenities will become a thing of the past. He also noted that the cost of renting these large, lavish spaces likely contributed to WeWork’s downfall.
WeWork filed for bankruptcy on Monday after years of financial struggles, despite making efforts to cut locations and renegotiate leases. As of June 30, the company had a real-estate portfolio spanning 777 locations.
Hodari pointed out that other providers may take over most of WeWork’s assets, but the extremely large 300,000 to 400,000 square foot WeWork spaces are too large for other companies to manage. He viewed leasing these enormous spaces as a major flaw in WeWork’s strategy, attributing it to the company’s downfall.
Luxurious coworking spaces were seen as a hallmark of WeWork’s operation at its peak, with amenities like yoga rooms and beer taps. However, these lavish locations did not contribute to the company’s profitability.
Hodari believes that despite WeWork’s implosion, the broader coworking industry is healthy, and companies seeking flexible-working arrangements have continued to support the industry as employees embrace hybrid working. He sees WeWork’s bankruptcy as the end of an era, hoping that it will shift the focus back to an industry that is continuing to progress.
WeWork did not immediately respond to a request for comment from Insider.