Teach for America bones up on Downtown with new lease

TRD New York /
Dec.December 03, 2013 08:00 AM

In an additional signal that Downtown is snagging price-conscious tenants from other Manhattan markets, Midtown-based Teach for America is close to signing a 170,000-square-foot lease in Lower Manhattan, a spokesperson for the educational nonprofit told The Real Deal. If closed this year, it would likely be among the 10 largest relocation deals Downtown, a review of CoStar Group data shows.

The organization, which places teachers in “high-need” schools around the country, now leases just over 100,000 square feet between its national headquarters at 315 West 36th Street and its local New York office located about three blocks north at 519 Ninth Avenue. The new lease, as TRD reported, will consolidate those offices into a greater amount of space spread over several floors of ACTA Realty’s 25 Broadway, an 858,000 square foot building at the corner of Morris Street that is also home to a WeWork collaborative workspace location.

The expected move is additional evidence of the strong activity Downtown that a Cushman & Wakefield study reported yesterday. It found more than 30 firms have relocated to the market from Midtown and Midtown South so far this year.

The transaction calls for taking 130,000 square feet on floors 11, 12 and 13 in the spring of 2015 and the remaining 40,000 square feet on the 14th floor in 2017. The lease is not signed, but is expected to be finalized by the end of the year, company spokesperson Steve Mancini said. He declined to discuss rental rates, but CoStar Group data shows the asking rent is $34 per square foot.

CBRE Group’s Mary Anne Tighe, CEO of the brokerage’s tri-state region, and Joan Meixner, a senior vice president, represented the tenant, a spokesperson for the brokerage said. The firm declined to discuss the lease negotiations. CBRE’s Gary Kamenetsky and Richard Levine, both senior vice presidents, represented the landlord, CoStar information shows.

The nonprofit organization founded in 1989 by Wendy Kopp has about 11,000 teachers working in classrooms in 34 states and Washington, D.C., Mancini said. It is bursting at the seams at its present locations.

“We are currently running out of space at our Midtown facilities,” Mancini said. “We ultimately chose 25 Broadway because the cost is lower, which leaves us with more resources to invest in our programs.”

The organization’s cost per square foot will decline with the new lease, Mancini said.

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