Jefferies Group Inc. renewed its lease at 520 Madison, taking on an additional 133,000 square feet. The deal – which closed early this month – will keep the company in its Tishman Speyer-owned headquarters through 2029.
“Some of the space – the midrise space, which is floors 16 through 20 – is currently under a lease that expires in 2021,” said Cushman & Wakefield executive vice president, Dale Schlather, who represented Jefferies, adding that some of the company’s offices in the building expire next year.
“We expanded; we extended both pieces, one part for fifteen years and the other part for eight years.” The company now occupies about 458,000 square feet in the 1 million plus square foot building.
Jefferies had sought to relocate its headquarters and had spent a lot of time touring many different neighborhoods. “We’ve been at it for two-and-a-half years and we’ve looked at all the usual suspects,” Mr. Schlather said, adding that the firm had pondered options in almost every neighborhood in Manhattan. “They looked at a split-occupancy too, at one point.”
“Hudson Yards didn’t work because the timing doesn’t work because the main part of lease expires in 2014.”
The World Financial Center and World Trade Center were options, at one point. “At one time, World Trade Three was of interest but we started to run into timing issues there too,” Mr. Schlather explained. “Then we looked at a lot of different things in Midtown.”
Mr. Schlather praised 520 Madison, lauding its proximity to transportation. “It’s got a fantastic lobby,” he said. “They’re going to have great presence. It’s five blocks from the 48th Street entrance to Grand Central and it’s across the street from the E Train to take you into Penn Station.”
Some of the smaller floors will be used to accommodate the company’s banking business while the lower, larger floor plate space is a perfect fit for its trading business.
“A big part of the transaction was building identity,” Mr. Schlather said.
Tishman Speyer – who did respond to an email for comment – will be doing some minor building to accommodate its expanding tenant.