A judge approved a plan for WeWork to emerge debt-free from more than six months in bankruptcy as the flexible workspace provider aims to operate with roughly one-third fewer wholly controlled locations than it had about a year ago.

A lawyer representing WeWork said in court Thursday the firm has resolved all disputes with "previously objecting parties," including landlords. In the process, the New York-based company's chain of wholly controlled global locations has dropped to 337 from about 500 in June 2023.

With the sign-off of bankruptcy court Judge John Sherwood, WeWork expects to come out of Chapter 11 in mid-June after it wraps up administrative matters, the New York firm said in a statement. Its plan would result in the company wiping out more than $4 billion of pre-petition debt in a debt-for-equity restructuring arrangement and cutting about $12 billion, or more than 50%, in future rent expenses.

WeWork said its global footprint, including franchised and joint venture locations in India, China, Japan and Israel, will total about 600 locations spanning a combined 45 million square feet in 120 cities across 37 countries.

“The plan is fair and equitable,” Judge Sherwood said in an hourlong hearing Thursday, adding that a reorganized WeWork will have a valuation of $760 million. “This is secured debt-for-equity restructuring. The result is a [WeWork] with a prospect to be a viable successful company. … [There’s] an exit strategy from the outset. … The settlement was reasonable.”

At the hearing, the judge also allowed WeWork to redact customer names in some court filings after a WeWork lawyer said it would be “devastating” for the company's "go-forward prospects" to make the names public and allow some landlords and its rivals to “poach” its customers.

“It’s been a little more than six months,” Steven Serajeddini, an attorney at Kirkland & Ellis representing WeWork, said in the hearing. “It feels like a lifetime. … This is an important company. The space houses the world’s largest companies and the … startups we’ve never heard of yet. We built the consensus. We secured the financing. … That was challenging. We built consensus with unsecured creditors. … It’s been a long road.”

WeWork will have $10 billion in lease obligations going forward, Ciara Foster, another attorney at Kirkland & Ellis, said at the hearing.

WeWork had “one of the most expensive commercial portfolios,” she said, adding its lease talks with landlords involved “hundreds of negotiations on a one-off basis” as no landlord had more than just a handful of locations each with WeWork.

Some of WeWork’s management were present at the hearing, she said. WeWork has resolved all disputes with "previously objecting parties," including landlords, Foster said.

“We have worked closely with the largest landlords around the world and one thing is clear: they believe in the future of the flexible office and they believe in the future of WeWork,” Peter Greenspan, WeWork’s global head of real estate, said in the statement.

WeWork’s confirmation caps twists and turns in the almost seven-month-long process, including threats of lawsuits from its unsecured creditors’ committee and unsecured noteholders before the company reached settlements with them. It also comes as Adam Neumann, WeWork’s ousted chief executive, said this week he’s given up on his bid to buy back the company he co-founded.

“In one of the largest and most complex restructurings, we have achieved extraordinary outcomes," WeWork Chief Executive David Tolley said in the statement. "Over the last year, we have also seen strong demand across the WeWork system."

As part of its reorganization plan, WeWork has said it’s reached agreements with stakeholders, including Japan-based investment giant SoftBank, an ad hoc group including asset manager BlackRock, and Cupar Grimmond, an investment arm of WeWork’s workplace management software partner Yardi, to tap $50 million in debtor-in-possession financing on an interim basis ahead of its bankruptcy exit and for another $400 million at the time of its emergence from bankruptcy.

The arrangement would result in Yardi becoming WeWork's majority owner with a 60% stake, because it’s providing most of the new investment, while the ad hoc group plans to have about a 20% stake. SoftBank’s stake falls to 16.5% unless WeWork taps some undrawn letters of credit from the Japan-based firm.

Neumann was removed as WeWork’s CEO in 2019 over corporate governance concerns when the money-losing company failed in its first attempt at going public with a valuation of $47 billion. That figure plunged to $9 billion when shares eventually started trading on the New York Stock Exchange in October 2021. WeWork filed for bankruptcy in early November after years of signing expensive leases at the cost of profit under Neumann. The company has been renegotiating leases with landlords to cut its lease burden, which poses the biggest challenge to WeWork becoming profitable.

"Since the 1990s, and in every cycle, there has been a coworking company that has filed for bankruptcy," Todd Henderson, co-head of global real estate at DWS, one of the world's largest real estate owners and a WeWork landlord, said in an interview Wednesday. "The reason for that is because their assets and liabilities are materially mismatched. ... Landlords like us will still be conservative in terms of how much of our space that we've leased to companies like that." He said DWS' exposure to WeWork is small.

The company has said it expects to operate more than 170 wholly controlled locations across the United States and Canada, the two countries where its bankruptcy case applies.

The company also moved its global headquarters to 18 W. 18th St. from 12 E. 49th St., where WeWork has rejected its lease there spanning over 300,000 square feet. WeWork, which first moved into its current headquarters space in 2018, has occupied about 112,000 square feet there, according to CoStar data. A spokesperson said while most of the New York employees will be at 18 W. 18th, the company will have another office at 71 Fifth Ave.

The company has said it hopes to turn profitable next year after emerging from bankruptcy protection and end this year with an occupancy rate of 76%, which it projects will rise to 85% by the end of 2028.

WeWork is a tenant in a Virginia building CoStar Group acquired earlier this year, making CoStar a creditor in the case. CoStar also competes with Yardi in providing real estate data.