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In late 2019, the majority owner of WeWork, Japanese conglomerate Softbank, was so desperate to get rid of the company's erratic CEO Adam Neumann it paid him a combined $778 million in consulting fees and stock purchases to leave.
But you can't keep a tech bro down, not when he has that kind of money. On Tuesday, Neumann was revealed to be quietly amassing a giant network of over 4,000 apartments across the Southern United States. According to the Wall Street Journal, he has told confidants he plans to shake up the rental industry.
The Comeback Kid
After cofounding the company in 2010, Neumann convinced investors to pour over $10 billion into WeWork, once grabbing a valuation of $47 billion by touting the firm as a tech company even though it was mostly a giant real estate office play. (It's now worth $7 billion.)
Neumann also reveled in the role of flashy business celebrity, but that led to his downfall. In 2019 his plans for an initial public offering fell apart as WeWork posted massive losses and Neumann exhibited an erratic, unprofessional management style — he allegedly once plied an interview candidate with tequila and once smoked so much marijuana on a chartered flight that the crew had to wear oxygen masks. Publicity downfall completed, Neumann's gigantic windfall from WeWork has nevertheless allowed him to position himself for the role of role of landlord to thousands:
- Neumann has acquired majority stakes in apartment buildings worth $1 billion in cities including Miami, Atlanta, Nashville, and Fort Lauderdale, as well as some suburban sites.
- He's using his own money to buy the buildings, which in addition to Softbank's "please go away" package includes another $500 million in stock sales he executed when WeWork's valuation was grossly inflated.
WeLive II?: While there's no official word on what Neumann plans to do with all the units, at WeWork he launched WeLive, which was supposed to be a network of shared furnished apartments. If that's what he's doing, here's hoping tenant interviews are conducted with something more civil than tequila.