Warner Music inks $250M lease deal at Paramount Plaza
UPDATED, 4:34 p.m., Oct. 9: Record giant Warner Music Group is moving about three avenues west. The world’s third-largest record company has taken 288,250 square feet at Beacon Capital Partners and Paramount Group’s Paramount Plaza in a deal that, according to CompStak data, is worth $250 million.
Warner will take the fourth floor and the seventh through 11th floors at 1633 Broadway, the 48-story, 2.53 million-square-foot tower between West 50th and West 51st streets.
The company will pay in the low $50s per square foot for the fourth floor space and in the mid $50s per square foot for the higher floors, the CompStak data show. The 16-year lease takes effect Jan. 1.
Warner disclosed the deal, first spotted by music industry publication Billboard, in an Oct. 1 regulatory filing with the U.S. Securities and Exchange Commission. Talk of the deal was first reported by Bloomberg Businessweek in September.
The company will get about three years of free rent on floors 10 and 11 and less than a year of free rent on the other floors, according to CompStak data.
Warner currently has space at RXR Realty’s 75 Rockefeller Center at West 50th Street, where it is paying slightly less than $40 a square foot, according to CompStak data seen by Businessweek. With its lease expiring next year, Warner was under pressure to find a new home as RXR plans to vacate the property before carrying out an extensive renovation to score higher rents.
Warner also has about 130,000 square feet at Vornado Realty Trust’s 1290 Avenue of the Americas, and was mulling a move to about 225,000 square feet at Vornado’s 7 West 34th Street between Sixth and Seventh avenues.
CBRE’s Mary Ann Tighe, Ken Meyerson, Robert Hill and Christopher Corrinet represented Warner, while their colleagues Stephen Siegel, Paul Amrich, Howard Fiddle and Patrice Meagher represented the landlord. A broker involved in the deal confirmed the transaction but declined to comment.
Representatives for Beacon declined to comment, and representatives for Paramount and Warner couldn’t be reached by press time.