The Real Deal New York

Jay Suites to Knotel: Stay out of my house

Startups spar over 30 Broad lease
By Konrad Putzier | August 03, 2018 04:30PM

Clockwise from top left: Jack and Juda Srour, 30 Broad Street, and Amol Sarva (Credit: HRO Group and Wikipedia)

When two flexible office companies sign leases in the same building, things can get messy.

Jay Suites plans to file an injunction to block its landlord at 30 Broad Street, Tribeca Associates, from bringing its rival Knotel into the property.

Jay Suites, the co-working company founded by brothers Jack and Juda Srour, has occupied the 14th floor of the 47-story office tower since 2011. Its lease prohibits the landlord from “leasing or subleasing of space in the Building to a person or entity in the Office Suite Business or business center rental business.” The company argues that Knotel, which it claims recently agreed to a deal for the 23rd floor in the building, fits that description.

In a letter sent to Tribeca Associates Thursday, Jay Suites demands that the landlord “must prevent Knotel from commencing, continuing and/or completing any build out in the Building, and from actually moving into the Building.”

Knotel declined to comment. Tribeca Associates, which bought the leasehold for 30 Broad Street from Gotham Realty Holdings for $130 million in 2016, did not respond to a request for comment.

As co-working companies spread across the city, more of them are bound to share a building. Earlier this week, for example, Knotel signed a management agreement for 45,000 square feet at the Sapir Organization’s 261 Madison Avenue, where WeWork is already a tenant. A source close to WeWork said its lease in that building does not include any restrictions blocking deals with other co-working companies, although these covenants are common across the industry.

In March, Jay Suites signed a 90,000-square-foot lease at 15 West 38th Street, next door to WeWork’s future headquarters.