Jan. 14 (Bloomberg) -- Credit Suisse Group AG plans to sign a 20-year lease to stay at its Americas headquarters, taking less space in the tower at 11 Madison Ave. in Manhattan.
The agreement is for about 1.2 million square feet (111,000 square meters), down from the about 1.8 million square feet the company currently occupies, said Alex Sapir, president of the Sapir Organization, owner of the building along with CIM Group. The offices in the Art Deco tower, home to the Zurich-based financial-services company since 1997, will undergo renovations beginning this year, according to a Credit Suisse memo announcing the lease.
“This project represents a significant investment in our Americas headquarters and demonstrates our commitment to providing staff with a modern, effective working environment,” Rob Shafir, Credit Suisse’s chief executive officer for the Americas, said in the memo.
The company will occupy floors 1 to 11, as well as 1B and 2B, once the project is completed in 2017, according to the memo. Credit Suisse currently leases space on the building’s 19th through 28th stories.
Sony Corp. will be taking space on higher floors, Sapir said. The 30-story tower, in the midtown south area, has views of Madison Square Park.
Marcy Frank, a spokeswoman for Credit Suisse in New York, confirmed the contents of the memo, declining to comment further on the company’s real estate.
New York’s banks and financial-services firms are downsizing space to control costs amid job cuts and tighter regulation. Manhattan office leasing climbed to a record in the fourth quarter, driven by large agreements by companies such as Citigroup Inc. seeking cost-effective real estate, according to brokerage Studley Inc.
Citigroup last month renewed its lease on 2.63 million square feet at 388 and 390 Greenwich St., the downtown office complex it inherited from Travelers Group when it bought the insurer 15 years ago. The bank had been examining for more than a year whether to stay at the complex or move to the World Trade Center or the new Hudson Yards development rising on Midtown’s far west side.
Credit Suisse has leases on offices at nearby 1 Madison Ave. through 2020 and will house employees from 11 Madison there on a revolving basis during the renovations, according to the company memo.
“The market conditions and our business requirements have changed significantly since the original lease was signed in 1997 and as a result, it has been necessary to optimize our space requirements for a new lease,” Shafir said in the memo.
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