WeWork co-founder Adam Neumann wants to take advantage of the sky-high demand for rentals and rising rent costs to create a new firm that will shake up the apartment industry.
Neumann, who left the co-working space giant WeWork in September 2019, has reportedly purchased more than 4,000 apartments worth over $1 billion in Florida cities Miami and Fort Lauderdale, plus Atlanta, Nashville and other prominent U.S. metros.
The Wall Street Journal said Neumann is aiming to create a “recognizable apartment brand” that will appeal to younger professionals – the same target market he went after when serving as WeWork’s chief executive officer.
D.J. Mauch, a partner in Neumann’s family office, told the Journal in an interview that he has been excited by the idea of multifamily apartment living in vibrant cities that “redefine the future of living”, that appeals to many young professionals.
“We’re excited to play a role in that future,” he said.
It’s not just inner-city living Neumann is interested in though, as some of his investments have been suburban apartment buildings, where demand has increased with the rise in remote workers meaning people no longer desire living in crowded and higher-priced city centers.
Neumann has extensive experience in real estate, having co-founded WeWork in 2010 and helping to raise more than $10 billion in funding for that company. While there, he launched WeLive, which was a company that intended to create a group of buildings where people could rent rooms in shared, furnished apartments. However, WeWork shut down the WeLive business shortly after Neumann left the company, which happened after its IPO plans fell through amid concerns over his management and shrinking profits at the firm.
WeWork has since gone public and now has a market cap of around $7 billion.
Neumann isn’t alone in wanting to invest in the rental real estate market. With high-demand for conveniently located rentals, developers have begun transforming commercial buildings into high-end rentals to cater to younger professional clientele.