A coworking company that opened in Decatur in 2020 has stopped making its lease payments amid news that it had filed for bankruptcy.
The Atlanta Business Chronicle first reported the news that WeWork was behind on its lease payments in Decatur, citing a source at Cousins Properties, the owner of the Decatur property. WeWork opened in Decatur in 2020 to much fanfare, the anchor of a then-new mixed-use development at 120 West Trinity Place, the site of the former Callaway building.
Even then, there were signs the company was in trouble.
The fate of this particular location had been an issue of concern following the cancellation of the company’s initial public offering in September 2019 and the resignation of its chief executive, Adam Neummann.
This week, WeWork filed for bankruptcy, according to CNBC, which reported the company intends to get rid of “non-operational” leases.
“The bankruptcy filing is limited to WeWork’s locations in the U.S. and Canada, the company said in a press release,” CNBC reported. “WeWork reported total debts of $18.65 billion against total assets of $15.06 billion in an initial filing.”
In an unusual move for Decatur, the city — which spearheaded the Callaway development and turned it over to Cousins properties for the redevelopment project — was blunt about the bankruptcy’s effect on that redevelopment project, confirming that WeWork was no longer paying its rent.
“WeWork filed for Chapter 11 bankruptcy protection on November 6, 2023, a move that is expected to expedite the closure of additional locations of its portfolio,” Decatur Planning and Economic Development Manager Angela Threadgill said. “The city has become aware that WeWork has stopped lease payments to the property owner of its Decatur location. We expect WeWork operations at the Decatur location will be affected by the bankruptcy filing. The city will work with the property owner on any re-leasing efforts as they may need.”
Efforts to redevelop the Callaway building had been years in the making.
The Decatur Development Authority bought the Callaway Building from DeKalb County in 2013 for $5.12 million. Cousins Properties bought the property in 2016 and developed it, creating a mixed-use development with 329 housing units, 18,000 square feet of retail and restaurant space, a parking deck and the four-story building.
WeWork leased 35,000 square feet of office space — three floors — of the new development.
In 2019, following news about the initial public offering being scrapped, Decatur officials said they were confident that it would not affect the company’s investment in downtown Decatur.
The global COVID-19 pandemic that broke out in 2020 changed office culture, as many employees who spent the pandemic working from home resisted the idea of returning to the office.
CNBC noted, “The Covid pandemic caused further pain [for WeWork] as many companies abruptly ended their leases, and the economic slump that followed led even more clients to close their doors.”
This story was provided by WABE content partner Decaturish.
