1 00:00:02,520 --> 00:00:08,160 Speaker 1: Bloomberg Audio Studios, podcasts, radio news been. 2 00:00:08,119 --> 00:00:09,960 Speaker 2: Very mixed for earning so far this week. 3 00:00:10,039 --> 00:00:13,400 Speaker 3: Large corporations from PEPSI to p ANDNG cutting their outlooks 4 00:00:13,440 --> 00:00:16,639 Speaker 3: due to Trump's tariff policy. One company, however, thinks they'll 5 00:00:16,680 --> 00:00:18,120 Speaker 3: benefit from the uncertainty. 6 00:00:18,480 --> 00:00:19,400 Speaker 2: We Work, which. 7 00:00:19,239 --> 00:00:22,720 Speaker 3: Provides coworking spaces for companies and individuals. It's hoping that 8 00:00:22,800 --> 00:00:26,080 Speaker 3: market risks will help it bounce back from bankruptcy. Joining 9 00:00:26,120 --> 00:00:26,960 Speaker 3: us now is that we work? 10 00:00:27,040 --> 00:00:29,240 Speaker 2: CEO? John Santora, John, it's good to see us, sir. 11 00:00:29,240 --> 00:00:31,680 Speaker 2: Thanks for being mid morning. John, give me the strategic 12 00:00:31,720 --> 00:00:32,120 Speaker 2: cup date. 13 00:00:32,360 --> 00:00:34,240 Speaker 3: What is the strategy now and how has it changed 14 00:00:34,720 --> 00:00:37,559 Speaker 3: in this certain period for the company compared to a 15 00:00:37,680 --> 00:00:40,000 Speaker 3: very uncertain period for the company a number of years ago. 16 00:00:40,280 --> 00:00:43,720 Speaker 4: So where we work stands today. We're a maturing company. 17 00:00:43,800 --> 00:00:46,320 Speaker 4: We're a company that has no debt. We're investing in 18 00:00:46,360 --> 00:00:49,040 Speaker 4: our portfolio around the world. We're investing in our members 19 00:00:49,080 --> 00:00:51,760 Speaker 4: and our people. So it's a very different place today 20 00:00:51,760 --> 00:00:53,000 Speaker 4: than it has been in the past. 21 00:00:53,120 --> 00:00:54,720 Speaker 2: Does it rely on a different kind of business? 22 00:00:55,520 --> 00:00:58,880 Speaker 4: Our business is flexibility, right, and to be able to 23 00:00:58,920 --> 00:01:04,000 Speaker 4: provide from one to one thousand seats for companies for 24 00:01:04,240 --> 00:01:06,679 Speaker 4: the entrepreneurs that's always been a part of our business. 25 00:01:06,760 --> 00:01:09,600 Speaker 4: Right it's about twenty five twenty seven percent of our business. 26 00:01:09,959 --> 00:01:12,919 Speaker 4: Then you have the smaller and mid sized companies fifty people, 27 00:01:13,080 --> 00:01:16,840 Speaker 4: hundred people, and then you have that whole enterprise platform 28 00:01:16,920 --> 00:01:19,600 Speaker 4: that we have which has been really growing the last 29 00:01:19,640 --> 00:01:20,000 Speaker 4: year or so. 30 00:01:20,120 --> 00:01:22,440 Speaker 3: Are you finding those changes are coming because of what 31 00:01:22,520 --> 00:01:24,560 Speaker 3: developed during the pandemic coming out of the other side, 32 00:01:24,560 --> 00:01:26,800 Speaker 3: It's not what forced the issue for the latch of enterprises. 33 00:01:27,040 --> 00:01:31,040 Speaker 4: I think if you look historically during different markets, right, 34 00:01:31,080 --> 00:01:34,280 Speaker 4: there's always that downturn, there's always that need to sub 35 00:01:34,360 --> 00:01:36,560 Speaker 4: lease space. We always take too much space, and good 36 00:01:36,600 --> 00:01:39,399 Speaker 4: times we'd get rid of too much space, and bad 37 00:01:39,440 --> 00:01:42,360 Speaker 4: times we fill that gap. So giving them twenty or 38 00:01:42,360 --> 00:01:46,000 Speaker 4: twenty five percent of their portfolio, that's flexible increase it, 39 00:01:46,160 --> 00:01:48,880 Speaker 4: decrease it without taking the hit to your books, without 40 00:01:48,880 --> 00:01:51,360 Speaker 4: writing off that space and writing off all the capital, 41 00:01:51,920 --> 00:01:55,960 Speaker 4: and being able to provide uh I that flexibility in 42 00:01:56,000 --> 00:01:57,520 Speaker 4: markets around the world is key. 43 00:01:57,640 --> 00:01:59,680 Speaker 5: So where are we right now with respect to the 44 00:01:59,760 --> 00:02:03,480 Speaker 5: ends certainty that we hear from corporate executives around the country, 45 00:02:03,840 --> 00:02:05,840 Speaker 5: is this a time where they want to ramp up 46 00:02:05,920 --> 00:02:08,960 Speaker 5: their flexibility and increase their footprint with you this or 47 00:02:09,000 --> 00:02:11,400 Speaker 5: pull it back because they actually see that as a 48 00:02:11,480 --> 00:02:13,680 Speaker 5: lever that they can pull without being seen too much. 49 00:02:13,880 --> 00:02:17,560 Speaker 4: This is a time any pores, A recession or whatever 50 00:02:17,639 --> 00:02:21,119 Speaker 4: is not good for any company. Right for us, our 51 00:02:21,240 --> 00:02:24,800 Speaker 4: clients are saying, I'm going to with the pause. I'm 52 00:02:24,840 --> 00:02:26,760 Speaker 4: not sure if I'm going to take more space, I'm 53 00:02:26,760 --> 00:02:28,280 Speaker 4: not sure if I'm going to cut back. 54 00:02:28,639 --> 00:02:30,639 Speaker 1: They pretty much are pausing. 55 00:02:30,280 --> 00:02:32,160 Speaker 4: With us, and that doesn't cost them anything. 56 00:02:32,560 --> 00:02:33,320 Speaker 1: Right, they stay in. 57 00:02:33,280 --> 00:02:37,320 Speaker 4: Our spaces, they'll move, they'll adapt in different markets. 58 00:02:37,680 --> 00:02:39,880 Speaker 1: We talked about it. You talked about India earlier on 59 00:02:39,919 --> 00:02:40,240 Speaker 1: the show. 60 00:02:40,320 --> 00:02:43,240 Speaker 4: We're seeing a big move out to India with our 61 00:02:43,280 --> 00:02:46,880 Speaker 4: clients in all the big banks, all the financial institutions 62 00:02:47,080 --> 00:02:50,880 Speaker 4: are growing their presence in India. The clients you mentioned, 63 00:02:50,919 --> 00:02:53,880 Speaker 4: Apple and so forth, they're all looking to take more 64 00:02:53,880 --> 00:02:55,799 Speaker 4: space in India. But are they going to take ten 65 00:02:55,840 --> 00:02:58,840 Speaker 4: and fifteen year leases with the uncertainty of what's going 66 00:02:58,840 --> 00:03:02,119 Speaker 4: on in the market, look to a player like us 67 00:03:02,160 --> 00:03:03,800 Speaker 4: to give them that flexibility. 68 00:03:03,960 --> 00:03:06,120 Speaker 5: Just to be clear, are you seeing stasis when it 69 00:03:06,120 --> 00:03:07,200 Speaker 5: comes to leasing right now? 70 00:03:07,280 --> 00:03:08,120 Speaker 1: Or are you seeing. 71 00:03:07,919 --> 00:03:12,000 Speaker 5: Leases increase in places like India and decrease in places 72 00:03:12,760 --> 00:03:15,079 Speaker 5: that previously have been popular. I'm wondering whether it's even 73 00:03:15,080 --> 00:03:16,160 Speaker 5: some of the Northeast cities. 74 00:03:16,400 --> 00:03:18,160 Speaker 4: I think it's a little too early to tell what 75 00:03:18,240 --> 00:03:21,680 Speaker 4: the long term effect will be. But you know, in 76 00:03:21,760 --> 00:03:26,600 Speaker 4: discussions with CEOs and CFOs, are you willing to make 77 00:03:26,680 --> 00:03:30,440 Speaker 4: that fifteen year commitment to a market today? With the uncertainty, 78 00:03:30,880 --> 00:03:32,760 Speaker 4: you have to pause. You have to think about it. 79 00:03:32,760 --> 00:03:34,840 Speaker 4: You have to think whether or not to invest that 80 00:03:35,000 --> 00:03:38,760 Speaker 4: major capital in a market, at least for this short term. 81 00:03:38,880 --> 00:03:41,040 Speaker 5: You have to step back in the go go days 82 00:03:41,040 --> 00:03:43,160 Speaker 5: of we Work. I remember that every time a building 83 00:03:43,400 --> 00:03:45,320 Speaker 5: was getting rebranded, it was going to be a WEE work. 84 00:03:45,440 --> 00:03:46,640 Speaker 1: When I was walking around. 85 00:03:46,400 --> 00:03:49,320 Speaker 5: The city and there was this massive expansion plan and 86 00:03:49,360 --> 00:03:50,800 Speaker 5: then there was a retrenchment. 87 00:03:51,160 --> 00:03:52,680 Speaker 1: Are you back in expansion plan? 88 00:03:52,720 --> 00:03:55,760 Speaker 5: Are you looking for acquisitions in terms of properties or 89 00:03:56,120 --> 00:03:58,040 Speaker 5: are you kind of happy with your footprint and just 90 00:03:58,080 --> 00:03:59,160 Speaker 5: expanding in other ways. 91 00:03:59,240 --> 00:04:03,640 Speaker 4: Yeah, we have a really good footprint now it's been restructured. 92 00:04:03,680 --> 00:04:05,160 Speaker 1: We're in the markets we want to be in. 93 00:04:05,200 --> 00:04:07,440 Speaker 4: We're in the markets that are our members want to 94 00:04:07,440 --> 00:04:10,480 Speaker 4: be We're in the right product Over time, though, for 95 00:04:10,520 --> 00:04:12,520 Speaker 4: the first time in the history of the company. We're 96 00:04:12,520 --> 00:04:16,320 Speaker 4: going through a traditional lease exploration, so we'll look to 97 00:04:16,400 --> 00:04:20,040 Speaker 4: upgrade in some markets. We may look to leave a market, 98 00:04:20,080 --> 00:04:20,880 Speaker 4: but that's. 99 00:04:20,680 --> 00:04:22,599 Speaker 1: Going to be a rare, rare, rare case. 100 00:04:23,040 --> 00:04:25,280 Speaker 4: We like the markets that we're in, so we're gonna 101 00:04:25,320 --> 00:04:26,479 Speaker 4: do some upgrades here and there. 102 00:04:26,680 --> 00:04:29,000 Speaker 5: During the pandemic, we saw a number of companies move 103 00:04:29,040 --> 00:04:32,240 Speaker 5: from New York to Florida. Are you seeing companies still 104 00:04:32,560 --> 00:04:33,240 Speaker 5: leave New York? 105 00:04:34,320 --> 00:04:37,680 Speaker 4: You know, I'm not grounded in real estate and grounded 106 00:04:37,680 --> 00:04:40,080 Speaker 4: pretty much in New York real estates where I've always 107 00:04:40,120 --> 00:04:42,080 Speaker 4: lived in New York and always worked out in New York. 108 00:04:42,720 --> 00:04:46,080 Speaker 4: The New York market is the It's the capital of 109 00:04:46,120 --> 00:04:49,560 Speaker 4: the world, right It's the capital of finance. It's the 110 00:04:49,600 --> 00:04:52,840 Speaker 4: capital of most companies. Their headquarters are there. A lot 111 00:04:52,839 --> 00:04:55,279 Speaker 4: of companies or headquarters are there. It will always have 112 00:04:55,360 --> 00:04:57,960 Speaker 4: a presence, it will always be important. 113 00:04:57,960 --> 00:04:59,160 Speaker 1: They'll always be headquarters. 114 00:04:59,200 --> 00:05:03,080 Speaker 4: There be some changes though over time, people will adapt. 115 00:05:03,560 --> 00:05:04,320 Speaker 1: When it comes to. 116 00:05:04,400 --> 00:05:07,040 Speaker 5: New markets that are across the US, are you seeing 117 00:05:07,080 --> 00:05:08,000 Speaker 5: more of a build up. 118 00:05:08,520 --> 00:05:09,920 Speaker 1: No, we're not West West Coast. 119 00:05:10,000 --> 00:05:12,559 Speaker 4: Yeah, we're not seeing that much. We're seeing markets start 120 00:05:12,560 --> 00:05:14,960 Speaker 4: to return. I was in San Francisco three times so 121 00:05:15,040 --> 00:05:17,440 Speaker 4: far this year. We're seeing that market start to return. 122 00:05:17,480 --> 00:05:20,080 Speaker 4: We're seeing people on the street, we're seeing buildings start 123 00:05:20,080 --> 00:05:20,560 Speaker 4: to fill up. 124 00:05:20,600 --> 00:05:23,040 Speaker 3: Finally cleaned up Basisi. Are you happy with progress? 125 00:05:23,560 --> 00:05:26,040 Speaker 1: They've made progress. They've definitely made progress. 126 00:05:26,040 --> 00:05:28,200 Speaker 2: One needs to change that. How do they fix this mess? 127 00:05:28,279 --> 00:05:30,480 Speaker 4: I think I think part of it is, you know, 128 00:05:30,560 --> 00:05:32,320 Speaker 4: it's security, it's safety. 129 00:05:32,400 --> 00:05:32,599 Speaker 1: Right. 130 00:05:32,600 --> 00:05:34,800 Speaker 4: People need to feel safe when they're going to work. 131 00:05:35,000 --> 00:05:37,000 Speaker 4: They need to feel safe as they're walking the streets. 132 00:05:37,040 --> 00:05:38,880 Speaker 4: They need to feel safe on the subways and the 133 00:05:39,520 --> 00:05:40,480 Speaker 4: transit systems. 134 00:05:40,880 --> 00:05:43,040 Speaker 3: John it's going to see you, sir, great. Thanks, thank 135 00:05:43,240 --> 00:05:45,160 Speaker 3: you for having me. John Son soa that we work 136 00:05:45,279 --> 00:05:45,799 Speaker 3: CEO