Peloton resorts to sublease at Hudson Commons
Struggling fitness company seeks taker for a third of its West Side office space
As Peloton gasps for air after a pandemic-fueled sprint, the fitness-media company is looking to sublease some of its pricey West Side office space.
Represented by Newmark, Peloton listed 100,000 feet — about a third of its office space at Hudson Commons — to be subleased, Bisnow reported this week.
The fitness company signed a lease for 312,000 square feet of office space at 441 Ninth Avenue in 2018, becoming Hudson Commons’ anchor tenant. Lyft is the building’s second-largest tenant, leasing just over 100,000 square feet.
The space, across the street from Hudson Yards, costs Peloton about $95 per square foot. Its lease runs until 2035.
Subleasing is a move many battered companies have made during the pandemic to get something for their empty office space. But in the months after Covid hit, Peloton was thriving.
The pandemic was a boon for sales of Peloton’s exercise bikes, treadmills and at-home workout subscriptions, and the company’s stock soared from $20 in March 2020 to $163 toward the end of the year. The company had trouble keeping up with demand for its equipment because of supply chain delays.
Only when the pandemic started to ease did Peloton’s troubles really start. In addition to equipment recalls and a factory plan cancellation, a decline in subscriptions hurt revenue as gyms reopened. Its founder lost his CEO post and listed his just-purchased Hamptons estate.
Peloton shares were trading at just under $11 Friday afternoon.
CommonWealth Partners bought the Hudson Commons building from Cove Property Group and Baupost Group for more than $1 billion in December. It was the priciest investment sale in New York City in two and a half years.
[Bisnow] — Cailley LaPara