NEW YORK CITY-Starbucks Corp. will be establishing its new East Coast headquarters at 7 Penn Plaza come summer 2012, says building owner the Feil Organization. The Seattle-based coffee company will relocate from its current location at 330 5th Ave. to a 19,876-square-foot space on the 15th floor of the 18-story Midtown South office building.
“The floor had been occupied and we took an early termination from a debt collection agency and replaced it with an investment grade credit organization like Starbucks,” David Turino, director of leasing for the Feil Organization, tells GlobeSt.com. “That also shows the change in the type of tenancy and the credit and quality of the tenants that are coming into this market than what traditionally had been here 15 years ago.”
The property, situated at 370 7th Ave. between 30th and 31st Streets, is located within Midtown’s emerging Penn Plaza District. The area is home to many ongoing developments, including Moynihan Station, Brookfield Office Properties’ 5.4 million-square-foot Manhattan West office project, Related Cos.’ Hudson Yards and the 7 subway train extension.
Robert C. Gallucci, senior director at Cushman & Wakefield, who represented the tenant in the transaction, tells GlobeSt.com that Starbucks decided to move based on growth in their retail division. “If they are opening up more retail stores, the office is basically supporting more retail,” he says, explaining that the 7 Penn Plaza location will house the company’s creative team and administrative personnel.
The new space, Turino says, will also support the tenant’s need for expansion. The company will utilize 80% of the 24,000-square-foot floorplate, providing the tenant wiggle room in case they add more staff. “We were able to give them opportunities to grow in the building, which they might not have had in other places,” he says. “But the proximity to Penn Station is certainly key to this building’s leasing.”
From an efficiency standpoint, Gallucci says the number one factor in the deal was getting all the employees on one floor versus two different floors. “It’s a more efficient floorplate,” he says. Asking rents ranged in the high $30s per square foot, he adds.
Turino represented the landlord on the transaction, while Jonathan Hoffman of Westerman Ball Ederer Miller & Sharfstein provided legal representation for the tenant, and Brian Palumbo and Michele Frankel provided legal representation for Feil.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
