WeWork’s valuation jumped 50 percent to $15 billion this week after Fidelity Investments reported that its shares in the company had appreciated spectacularly in the fourth quarter of 2015. The firm is also reportedly planning to enter another round of financing.

The new valuation – based on a 53 percent rise in Fidelity’s appraisal – elevates WeWork nearly to the level of deeply-established commercial landlords such as Boston Properties, which is worth $17 billion and owns 10 times the amount of space as the startup. Mort Zuckerman, that real estate investment trust’s chairman, also happens to be a major investor in WeWork.

Investors’ WeWork optimism comes despite fears the company will have difficulty weathering a significant downturn, as some of its peers have, and despite the recent slowdown in the tech startup industry that provides WeWork with many of its tenants, the Wall Street Journal reported.

“The obvious risk and the obvious concern is, in a downturn, you would see some shakeout of your tenants,” Ian Weissman, an analyst for Credit Suisse Group AG, told the Journal. “It is an untested business model to a large degree.”

WeWork co-founder Miguel McKelvey said last fall he expected the firm to expand to 1,000 locations over the next few years, up from the 52 it managed at the time. The company has received nearly $1 billion in investment from the likes of Fidelity and T. Rowe Price Group.

The company has said its 40 percent profit margin, excluding construction costs, are strong enough to carry them through future down cycles.

Back in June, sources told The Real Deal that WeWork’s then-valuation was around 100 times the company’s earnings, an extremely high ratio. At the time, SL Green Realty was trading at about 20 times its earnings. Regus, another shared-office provider, traded at 34 times its earnings.

WeWork – which manages nearly 3 million square feet in the city – has recently pushed into new lines of business, including WeLive, its “co-living” dormitory venture. It’s also announced plans to expand internationally into countries India and China.

It also plans to expand into new cities domestically, many of which are unlikely to host the same sort of tech startup-heavy tenant pool the company has leased to in cities such as New York.

“Expanding aggressively right now—it’s probably a suboptimal time to be doing so,” John Bejjani, a real-estate analyst at Green Street Advisors, told the Journal. “But their business model isn’t going to pause for a few years waiting for the real-estate cycle to turn over.” [WSJ] – Ariel Stulberg

Source: WeWork could be raising even more money