The online media company BuzzFeed has secured a two-year sublease from Tiffany for nearly 58,000 square feet on the full eighth floor of L&L Holdings’ historic LEED for Core and Shell Gold 200 Fifth Avenue. The company – which is currently heaquartered around the corner at 54 West 21st Street – is nearly doubling its footprint in connection with the move. Tiffany will build out the space itself – meaning that BuzzFeed will likely be on the move again when the sublease expires in the fall of 2015.
The deal reflects a couple of important points about the technology sector and the Midtown South submarket generally, as Lois Weiss notes in her piece in the Post that reported the transaction. First, locking into long-term leases is difficult for technology companies, whose space requirements are volatile: BuzzFeed started out with just 3500 square feet at 113 Spring Street. Second, although the supply of office space in Midtown South is limited, it is difficult for landlords to find tenants with the resources necessary to secure an entire floor at asking rents that were – at least as of this past January – nearly $80 per square foot. (We note these issues in our guide to tech sector office leasing in Manhattan, which you can access for free here at BMO.)
Tiffany will continue to occupy 400,000 square feet on the 9th through 14th floors. Other office tenants at 200 Fifth Avenue are Grey Group on 2 through 6 and 7, and IMG Worldwide, also on 7.