Twitter Agrees to Lease Space for NYC HeadquartersCraig Giammona
Twitter Inc., the microblogging service that went public last year, agreed to lease space for its Manhattan headquarters in midtown south, the area that’s become popular with media and technology companies.
The San Francisco-based company, which has seen its stock price more than double since its initial public offering in November, is taking 140,928 square feet (13,093 square meters) at 245 W. 17th St. and 249 W. 17th St., adjacent buildings between Seventh and Eighth avenues owned by Savanna, the real estate investor said today in a statement.
Twitter is the latest technology firm to set up shop in midtown south, the market roughly from 30th to Canal streets, which has the lowest office-vacancy rate in the U.S. The social-media company will be located around the corner from 111 Eighth Ave., the converted freight terminal in the Chelsea neighborhood purchased by Google Inc. for $1.84 billion in 2010.
Savanna bought the 17th Street buildings in 2012 and spent $21 million on a nine-month overhaul that retained the “loft feel” of the century-old properties, according to Kevin Hoo, a vice president at the New York-based private-equity firm.
“We specifically targeted the aesthetic that companies like Twitter are after,” Hoo said in an interview. “This particular area of Chelsea, being a block from Google, the entire area is an epicenter that attracts talent.”
The landlord expects Twitter to move into the new offices sometime this year. Financial details of the lease are confidential, Hoo said.
Among other technology companies that have taken space in midtown south since the Google deal is International Business Machines Corp., which this month agreed to lease 120,000 square feet at 51 Astor Place, a new tower in the East Village, for its Watson unit. Facebook Inc. is renting offices at 770 Broadway, across the street from 51 Astor.
Landlords in midtown south sought rents averaging $62.61 a square foot in 2013, a 26 percent jump from the previous year, according to Cushman & Wakefield Inc. The market’s vacancy rate at the end of December was 8.6 percent, the lowest in the U.S., followed by San Francisco at 9.1 percent, data from the real estate services firm show.
Companies such as Google and Twitter were drawn to Chelsea in part because of the neighborhood’s proximity to the L subway line, which serves Union Square, the East Village and hip neighborhoods in Brooklyn, Hoo said.
The two 17th Street properties have about 285,000 square feet combined and about 60,000 square feet are available, according to Hoo. The six-story building at 249 W. 17th St., which dates to 1902, was a warehouse for the Siegel-Cooper Co. department-store chain. Room & Board, a maker of home furnishings, leases about 60,000 square feet on the first three floors, Hoo said.
The first six of the 12 stories at 245 W. 17th St. are directly connected to the adjacent property. Twitter was drawn to the roof access available at the building, which was completed in 1909, Hoo said.
Shares of Twitter, with a market value of about $35 billion, rose 0.6 percent to $62.80.