WeWork is seeking to get out of some Canadian office leases after filing for bankruptcy protection in the U.S.
Citing court filings, the Canadian Press reported that office space-sharing company is aiming to exit two leases in Toronto, two in Vancouver and one in Burnaby, B.C., among other locations, to reduce expenses.
As Connect reported, WeWork filed for Chapter 11 bankruptcy protection in New Jersey federal court on Monday, reporting liabilities of US$10 billion to US$50 billion. The company has also taken legal steps to protect its Canadian interests.
“We have filed proceedings in Canada under Part IV of the Companies’ Creditors Arrangement Act to recognize our U.S. Chapter 11 cases,” WeWork said in a statement that it provided to Connect.
Among its other provisions, Part IV recognizes cross-border insolvencies and, pending a judge’s order, protects debtors from legal action in Canada for any period that the court considers necessary.
“WeWork spaces remain open and there is no change to the way we operate for our members in Canada,” said the company, referring to space users, in the statement to Connect.
The Canadian Press reported that WeWork is seeking to exit leases at 1045 Howe Street and 1090 West Pender Street in downtown Vancouver; 4635 Lougheed Highway in Burnaby’s Brentwood area and 292 Adelaide Street West in Toronto’s financial district.
WeWork regards the Canadian leases as “unnecessary and burdensome.”
In a news release on the bankruptcy filing, WeWork announced that Toronto-based law firm Goodmans LLP is serving as its Canadian legal counsel.
“We have exceptional confidence that we will emerge from this process as a financially stronger company that can focus on investing in our products, our services, our growth, our employees, and most importantly, our members,” said WeWork in its statement.
Monte Stewart serves as Content Director - Canada for Connect Commercial Real Estate.
Based in Vancouver, British Columbia, Monte provides daily news coverage of major Canadian commercial real estate markets, including Vancouver, Toronto, Montreal and Calgary. He has written about the real estate sector for various media outlets and Avison Young since the early 2000s.
In addition, he has covered sports, general news and business for several leading wire services and publications, including The Canadian Press, The Associated Press, The Calgary Herald, The Globe and Mail, Research Money, The Daily Oil Bulletin, Natural Gas World and The Toronto Star.
Monte is active in his community as a youth basketball coach and raises funds for such charitable causes as Movember.