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WeWork Offers Half Off to Some Tenants Signing Longer Leases

Crystal Tse and Gillian Tan

(Bloomberg) -- WeWork has offered some of its tenants half off their rent to lure them into signing longer-term leases and minimize cancellations during the pandemic, according to people with knowledge of the matter.

Some of the discounts are targeted at tenants in the U.S. who are on month-to-month contracts and agree to sign on for as little as two or three months, said some of the people, who asked not to be identified because they weren’t authorized to discuss the arrangements publicly.

The New York-based company has long used discounts to hook tenants but has been making more regular adjustments to the program since the coronavirus outbreak, another person said. It’s unclear how widespread the offers are but, as of last June, more than a quarter of WeWork’s tenants were on month-to-month-leases, according to a securities filing.

A representative for WeWork declined to comment.

Read more: WeWork’s New Crisis: ‘Workplaces Will Never Be the Same’

The Covid-19 pandemic is keeping large swaths of the global workforce at home and taking a heavy toll on renters of office space. Although the bulk of WeWork locations remain open, the SoftBank-backed company said last week that it no longer expects to hit 2020 financial targets. It separately cut another 250 jobs last week in an ongoing effort to lower expenses. WeWork competitor Knotel Inc. said Friday it will reduce headcount by half.

(Updates with additional reporting in the third paragraph.)

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