The offices of 568 Broadway are part of a tech company trend: an intricate web of subleases within a single space, the New York Times reported.
Scholastic, for example, is subletting two floors in the building to Foursquare, which is subletting one of the levels to several smaller tech firms. And one of Foursquare’s tenants, the phone-app designer Fueled, is willing to share its space — and an array of snacks — for $650 a month.
Foursquare and Scholastic struck their 10-year deal in December 2011, as previously reported.
In the last several months, Midtown South tech companies have been opting for sublet deals over direct leases. Rents are slightly cheaper, are for shorter lengths of time than the typical 10 years, and require a smaller security deposit, tenants and brokers told the newspaper.
From Canal Street to 30th Street, sublets comprised 19 percent of major leasing this year, up from 11 percent in 2010, according to Studley data cited by the Times.
“They don’t know about the future, so flexibility is key,” Heidi Learner of Studley told the Times. “You don’t know about what head count will be, whether you will get any venture capital funding, or whether you will be acquired.” [NYT] – Mark Maurer