A number of Interpublic Group agencies are moving from 919 Third Avenue into 220,000-square-feet at nearby 909 Third Avenue, sources have revealed to The Commercial Observer.
Largest among the group is Weber Shandwick, a major public relations firm that is a subsidiary of IPG and has long been based out of 919 Third Avenue.
Weber Shandwick and the other IPG agencies will take floors five through nine in 909 Third Avenue, as well as other smaller pockets of space in the 1.3 million-square-foot building.
The lease appears to be a significant deal for Vornado, the tower’s landlord, which for years has struggled to fill the block of vacancy that will now be largely absorbed by IPG. The deal comes during a slower pace of leasing in Midtown, a lull that has been felt especially in peripheral areas of the neighborhood like Third Avenue, where space typically already trades at a discount to the area’s main commercial thoroughfares.
A person familiar with the deal said that IPG is moving from 919 Third Avenue, which is owned by the rival REIT SL Green, because it wants to expand and there is little room in that property to grow. The company, one of the largest advertising and media conglomerates in the world, wanted to remain nearby to preserve commuting patterns for its employees, making 909 Third Avenue a good fit.
The deal is one of the largest to get done in Midtown during the summer, a traditionally slow period of leasing in the city that has been appeared particularly lethargic this year because of continued economic and political uncertainty in the face of an upcoming presidential election.
Vornado, one of the city’s largest commercial real estate owners, meanwhile has continued to try to head off losing a large tenant of its own. The company is in a contest with 11 Times Square to hold onto Microsoft, a roughly 250,000 to 300,000-square-foot tenant that is currently located at Vornado’s 1290 Avenue of the Americas and is in the process of deciding whether to renew or relocate.