
WeWork CEO Lease Deals Troubling to Investors
WeWork officers hold ownership stakes in buildings that will generate rent payments totaling more than $122 million, according to a report in The Wall Street Journal. WeWork CEO Adam Neumann is said to earn rental income from multiple properties that are leased back to WeWork.
The arrangement has investors wondering about potential conflicts of interest since they note Neumann could benefit on rents or other terms with the company. WeWork Cos. defended its review process for related party transactions. “Those transactions are reviewed and approved by the board, and they are disclosed to investors,” WeWork said.
The WSJ report noted a prospectus related to a debt offering last year revealed leases at properties owned in part by Neumann. That rental income encompassed more than $12 million in rent to buildings “partially owned by officers” of the company between 2016 and 2017. Future rent payments are expected to total more than $110 million over the lease term.
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