Article by Stephanie Friese and Jennifer Garner on "A WeWork Agreement is Not a Lease, and Why This Matters Now"
In an article published on May 11, 2020 in GlobeSt.com / Real Estate Forum, Stephanie Friese and Jennifer Garner discuss the new paradigm for co-workers and space providers in the wake of COVID-19.
“Space as a service agreement, or co-working agreement, are licenses, which are separate and distinct from leases,” explain Friese and Garner. “By design, the co-working agreement provides the licensor with more flexibility, and legally they are more like gym or club memberships. Flexibility and the retention of control however, may have the unintended consequence of licensors having heightened responsibilities to their customers.”
Friese and Garner further explain that the biggest difference in these two types of agreements is a lease gives a tenant more control, such as exclusive possession of a space. But in co-working agreements, the licensor maintains control, and the “tenants” must share their workspace and all the amenities.
The COVID-19 pandemic has raised issues that have yet to be tested in court and results will vary depending on specific facts. “When evaluating premises liability claims, varying fact patterns, and with COVID-19, especially timeframes, are important,” said Friese and Garner. “Who will be liable will depend on a number of factors, including when the exposure occurred and whether the injured party acted reasonably in entering the shared space at all and therefore whether, in light of information available to the public, the injured party assumed the risk.”
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