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Owner Tears Up 82,000-SF Lease, Saves Successful Tech Firm $24 Mil

NEW YORK CITY-A technology firm that has hit it big providing instant messaging services to corporate clients convinces its Midtown building owner to nullify its 10-year lease. Potential rent savings add up to $24 million.

By Glen Thompson | Updated on September 27, 2001

NEW YORK CITY-In what tenants and building owners alike may regard as a highly improbable scenario in the New York City real estate community, a Midtown tech firm has received a full and unconditional release from its long-term, 82,000-sf lease.

LivePerson Inc. is an Internet software company that provides corporate instant-messaging systems. Located at 330 W. 34th St., the firm had nine years left on it’s 10-year lease. A $2-million build out had just been completed when a series of fundamental changes to its business model made the two-floor space impractical and needlessly expensive, LivePerson president Tim Bixby tells GlobeSt.com. “We’ve been looking for a subtenant and negotiating with the building owner for about nine months,” Bixby says.

Unlike thousands of Web-based businesses, however, LivePerson’s quest for smaller quarters was based not on lack of cash but on a corporate reorganization that moved much of its workforce either out of the country or into cyberspace. “We reduced our direct sales force in favor of an on-line sales staff that can work from any location,” Bixby says. “We also moved a lot of our operation to Israel.”

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