Cycling startup Peloton quadruples HQ space in Chelsea
Normandy leases top four floors of 138K sf office building
Indoor cycling fitness startup Peloton is moving its headquarters to the top four floors of a Normandy Real Estate Partners-owned Chelsea office building, more than quadruple the size of its current space in the neighborhood.
Peloton is the first tenant to sign at the 12-story, 138,000-square-foot Class A property at 119-125 West 25th Street, between Sixth and Seventh avenues, since Normandy launched a $20 million renovation. The 40,750-square-foot spread covers floors nine through 12.
Normandy, a Morristown, N.J.-based investment firm led by David Welsh and Finn Wentworth, rescued the now-vacant property from foreclosure for $54.5 million in 2013.
In February, the owner secured a $72 million loan for leasing and renovations, creating an office penthouse space. New tenants are slated to move in summer 2016.
Average asking rents for Class A buildings in Chelsea — in the Midtown South office market — are around $90 per square foot, according to Cushman & Wakefield data.
Peloton is leaving its 9,660-square-foot headquarters at the Vanbarton Group’s 158 West 27th Street. In June 2014, the company signed for that space and opened a fitness studio at 140 West 23rd Street.
Nearly 100,000 square feet are available for lease at Normandy’s office building, including retail space spanning 7,400 square feet on the ground floor and 7,800 square feet in the basement.
Earlier this month, Peloton raised $75 million from fitness-focused private equity firm Catterton. The company, founded in 2012, positions itself as the more convenient, less cultish Soulcycle, where customers buy a bicycle for about $2,000 with a built-in tablet computer. They pay a monthly subscription fee to watch live streaming video of exercise classes in the Chelsea studio.
There are 12 Peloton showrooms in the U.S., including ones in East Hampton, White Plains and Manhasset.