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WeWork has filed for Chapter 11 bankruptcy protection, marking a stunning fall for the office sharing company once seen as a Wall Street darling that promised to upend the way people went to work around the world.

In a Nov. 6 announcement, WeWork said it entered into a restructuring support agreement with the majority of its stakeholders to 鈥渄rastically reduce鈥� the company鈥檚 debt while further evaluating WeWork鈥檚 commercial office lease portfolio.

WeWork is also requesting the 鈥渁bility to reject the leases of certain locations,鈥� which the company says are largely non-operational, as part of the filing. Specific estimates of total impacted locations were not disclosed Nov. 6, but all affected members have received advanced notice, the company said.

鈥淣ow is the time for us to pull the future forward by aggressively addressing our legacy leases and dramatically improving our balance sheet,鈥� CEO David Tolley said in a prepared statement. 鈥淲e defined a new category of working, and these steps will enable us to remain the global leader in flexible work.鈥�

The specter of bankruptcy has hovered over WeWork for some time. In August, the New York company sounded the alarm聽over its ability to remain in business. But cracks had begun to emerge several years ago, not long after the company was valued as high as $47 billion.

WeWork is paying the price for aggressive expansion in its early years. The company went public聽in October 2021 after its first attempt to do so two years earlier collapsed spectacularly. The debacle led to the ouster of founder and CEO聽Adam Neumann, whose erratic behavior and exorbitant spending spooked early investors.

Japan鈥檚 SoftBank stepped in to keep WeWork afloat,聽acquiring majority control over the company.

In a prepared statement Nov. 6 ahead of WeWork鈥檚 official announcement, Mr. Neumann called the bankruptcy filing disappointing and said it鈥檚 been challenging for him 鈥渢o watch from the sidelines since 2019 as WeWork has failed to take advantage of a product that is more relevant today than ever before.鈥�

Still, he added, a strong reorganization could allow WeWork to emerge successfully.

Despite efforts to turn the company around since Mr. Neumann鈥檚 departure 鈥� including significant cuts to operating costs and rising revenue 鈥� WeWork has struggled in a commercial real estate market that has been rocked by the rising cost of borrowing money,聽as well as a shifting dynamic for millions of office workers聽now checking into their offices remotely.

In the Nov. 6 filing, WeWork listed about $18.7 million in debts and $15.1 million in assets as of June 30.

In September, when WeWork announced plans to renegotiate nearly all of its leases, Mr.聽Tolley noted that the company鈥檚 lease liabilities accounted for more than two-thirds of its operating expenses for the second quarter of this year 鈥� remaining 鈥渢oo high鈥� and 鈥渄ramatically out of step with current market conditions.鈥�

At the time, WeWork also said it could exit more underperforming locations. As of June 30, the latest date with property numbers disclosed in securities filings, WeWork had 777 locations in 39 countries.

Beyond real estate costs, WeWork has pointed to increased member churn and other financial losses. In August, the company said that its ability to stay in operation was contingent upon improving its liquidity and profitability overall in the next year.

WeWork鈥檚 bankruptcy filing arrives at a time when leasing demand for office space is weak overall. The COVID-19 pandemic notably led to rising vacancies in office space as working from home became increasingly popular 鈥� and major United States markets, from New York to San Francisco, are still struggling to recover.

In the United States, experts note that WeWork鈥檚 18 million square feet is a small fraction of total office inventory in the country 鈥� but on a building-by-building level, landlords with exposure to WeWork could take significant hits if their leases are terminated. The shuttering of select WeWork locations to cut costs isn鈥檛 new. In some past cases, landlords鈥� building loans moved to special servicing after losing WeWork as a tenant, credit rating and research firm Morningstar Credit previously told The Associated Press.

While the full impact of this week鈥檚 bankruptcy filing on WeWork鈥檚 real estate footprint is still uncertain, the company sounded an optimistic note Nov. 6.

鈥淥ur spaces are open and there will be no change to the way we operate,鈥� a WeWork spokesperson said in a statement to The Associated Press. 鈥淲e plan to stay in the vast majority of markets as we move into the future and remain committed to delivering an exceptional experience and innovative flexible workspace solutions for our members.鈥�

WeWork and certain entities filed for Chapter 11 bankruptcy protection in U.S. District Court in New Jersey, with plans to also file recognition proceedings in Canada, according to Monday鈥檚 announcement.

WeWork locations outside of the U.S. and Canada will not be affected by the proceedings, the company said, as well as franchisees worldwide.

This story was reported by The Associated Press.