CEO of WeWork Adam Neumann
WeWork has become a business with a billion valuation by being a good tenant. Now it is starting a close $ 3 billion fund to become a landlord too.
WeWork, which recently renamed The We Company, is making ARK, a "global real estate and management platform" to buy stakes in buildings where it plans to rent a lot of space, the company announced Wednesday. It will begin with $ 2.9 billion of total equity.
"ARK will focus on acquiring, developing and managing real estate in global gateway cities and high-growth secondary markets that will benefit from WeWork's coating," the release said. It will use WeWork's proprietary technology and relationships to access real estate opportunities and will "instantly stabilize assets by performing a proven pre-packaged business plan and will apply The We Company 's comprehensive property owner solutions based on The We Company established. abilities in sourcing, building, filling and operating properties. "
The Fund could further complicate issues of WeWorks allegiances, which were reported by a Wall Street Journal report in January, which revealed CEO Adam Neumann benefited from renting buildings he owns at WeWork. Under the new plan, Neumann will actually transfer some of his property holdings to the ARK Fund, Bloomberg Businessweek reported.
Although this may provide better optics to the company, since ARK will be run independently of WeWork's main business, ARK will still be under The We Company umbrella, according to Businessweek. A WeWork spokesman refused to confirm or comment on the transfer of Neumann's real estate to CNBC.
But ARK can also provide a stable level for WeWork and its investors, which is an important step in preparing a public offering. WeWork, like other recent tech IPOs, remains unprofitable. The company said it had a net loss of $ 1
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Watch: We Company, known as WeWork, files confidential for IPO