A tenant at a Flatiron District office building is taking WeWork’s exit in stride, signing for more square feet with owner RXR Realty.
Mobile banking app Current signed directly with the owner to extend its stay at 620 Sixth Avenue, the Commercial Observer reported. The company is increasing the 42,000 square feet its agreed to last year to nearly 72,000 square feet stretching across an entire floor of the property.
The company previously took space from WeWork under a four-year contract.
Asking rent for the lease was upwards of $100 per square foot. The length of the lease was not disclosed.
WeWork’s financial woes culminated in filing for bankruptcy in early November and a restructuring process that allowed it to exit leases in spades across the country.
The co-working firm took 212,000 square feet at the RXR property in 2019, reported to be for its own headquarters. WeWork has been working with Scott Rechler’s firm for months regarding handing back spaces at the landlord’s properties, which were not identified among the 40 New York City leases it is trying to abandon via bankruptcy.
WeWork handed over the 620 Sixth Avenue space back to RXR this month. A spokesperson for Current said the company’s office operations won’t be affected as the banking app transitions to a direct lease.
Current Real Estate Advisors’ Rob Kluge and Adam Henick represented the tenant in the lease, while Alexandra Budd and Daniel Birney represented RXR in-house.
The fallout of WeWork’s bankruptcy should continue unabated for months to come. Before Thanksgiving, some landlords filed objections to the company’s restructuring plan.
WeWork told landlords in September it would work to renegotiate “nearly all” of its leases, but last month’s bankruptcy filing gave the company more power to abandon deals altogether. CreditSights analyst Evan DuFaux told Bloomberg WeWork is walking a “fine line” with its restructuring plans, as canceled leases pose a detriment to office landlords relying on income from the company’s occupancy.
— Holden Walter-Warner
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