Tech companies lose grip on leasing in Midtown South

Other industries are moving into the trendy neighborhood to compete for employees

TRD New York /
Jul.July 03, 2017 07:49 AM

from left: 61 Ninth Avenue and Aetna CEO Mark Bertolini (Credit: Vornado Realty Trust and Getty Images) and 413 West 14th Street

Aetna’s deal to lease 145,000 square feet in the Meatpacking District is just the latest sign that non-technology tenants are increasingly drawn to Midtown South.

Tech tenants accounted for just 13 percent of new leases in Midtown South during the first half of 2017, down from 35 percent the same time last year, according to figures from JLL cited by the Wall Street Journal. In the first half of 2015, tech’s share in the neighborhood was 48 percent.

While companies like Google and Facebook still have large presences in Midtown South, non-tech companies have realized that they’re competing for the same work force.

“We think it’s more than just wanting to hang with the cool kids,” JLL research director Tristan Ashby said. “These more traditional corporations have realized that they are competing for the same talent as Google and Facebook. The candidates they want to hire don’t commute to Grand Central.”

Earlier this year, the Bermuda-based insurance firm Argo Group signed a lease for 48,000 square feet at 413 West 14th Street, a redevelopment project in the Meatpacking District by Rockpoint Group, Highgate and the Meilman family.

“Argo was one that shocked the market,” said CBRE’s Paul Amrich, who is part of the leasing team at the building. “They were like, ‘Wait, insurance in the Meatpacking District?’ But we have seen more and more of that occurring.”

One thing experts said the numbers don’t show is space taken by tech firms in co-working facilities.

“They are successfully capturing many of the startups we have accommodated in recent years. I think the statistics are a little askew,” said ABS Partners Real Estate’s Jay Caseley.

TAMI tenants, meanwhile, are increasingly heading Downtown. [WSJ] – Rich Bockmann

 

Related Articles

arrow_forward_ios
Eric Gordon

Eric Gordon on the evolution of the residential data game — and how to stay competitive in the new world

Big Tech locations in NYC

MAP: Here’s a look at all the Big Tech locations in NYC

What will proptech look like in 2019 and beyond?

From left: RealPlus' Eric Gordon, Corcoran's Pam Liebman, Halstead's Diane Ramirez, Douglas Elliman's Howard Lorber and Brown Harris Stevens' Bess Freedman (Credit: Eric Gordon by Emily Assiran, Getty Images, Halstead, BHS, iStock)

Terra sells part of RealPlus stake to Corcoran and Elliman

“I can talk about erections all day”: NAR tech consultant’s bizarre fireside chat

Fears about privacy and Big Brother-like tactics in real estate are taking hold

John Burger: how tech makes real estate “more professional”

Elegran founder and CEO Michael Rossi, and a segment of the domain registry history for timewarnercentercondos.com

Elegran revealed as creator of fake building websites

arrow_forward_ios