When Amazon required more office space to comply with its return-to-office mandate, WeWork provided a solution by securing additional real estate on the company’s behalf. In August, WeWork expanded its presence at 1440 Broadway by leasing an extra 259,000 square feet for Amazon, adding to the 300,000 square feet it already occupied there.
This arrangement is part of WeWork’s evolving strategy to act as an intermediary in large office deals. Rather than simply fitting clients into its existing coworking locations, WeWork now sources and structures new leases or subleases tailored to client needs. According to a source familiar with these transactions, this approach allows companies like Amazon to avoid lengthy lease negotiations and move into ready-to-use offices within about three months. The short-term agreements offer flexibility for businesses still determining their long-term office requirements.
“We have a membership agreement [with Amazon] that has all the terms, conditions and everything else,” said WeWork CEO John Santora in May at The Real Deal’s New York forum. “We now just have to fill in those blanks in terms of the location and the cost.”
Amazon’s urgency stemmed from its directive that 350,000 corporate employees return to offices five days per week starting last January. However, limited workspace forced delays in several cities such as New York, Atlanta, and Houston.
To address these shortages, WeWork arranged additional leases for Amazon at other properties as well. In November, it signed a 304,000-square-foot lease at Vornado Realty Trust’s 330 West 34th Street and added another 112,000 square feet at Brookfield Properties’ 5 Manhattan West in February—both managed for Amazon.
The long-term role of these coworking spaces within Amazon’s broader office strategy remains unclear. In addition to using flexible space through WeWork, Amazon owns substantial office assets including the Lord & Taylor building at 424 Fifth Avenue—which it purchased from WeWork for $1.15 billion in 2020 and reopened last year—and recently acquired RFR’s 522 Fifth Avenue for $350 million as well as secured a direct lease at Property & Building Corp’s 10 Bryant Park.
“I think that firms need a piece of the real estate that is flex, a piece of real estate that is probably owned, and then there are the traditional leases,” Santora commented during his appearance in May.
WeWork has been refocusing its business after emerging from bankruptcy proceedings in June 2024 by pursuing cost-efficient growth strategies and partnerships like those with Amazon. While most activity is centered in New York City, similar models have been used by WeWork for clients in Seattle, Nashville, and Silicon Valley. Financial details about these arrangements were not disclosed by either company.
Industry observers note that such deals could challenge traditional landlords who depend on long-term tenants for steady revenue streams; sources suggest the lease terms range from two to five years with agreements expiring concurrently between landlord or sublandlord and client company.
However, this model may benefit owners of older buildings facing occupancy challenges—for example, 1440 Broadway recently entered special servicing again due to ongoing vacancy issues.
