600,000 Square Feet of Office Space in the Bag for Coach
Jotham Sederstrom Nov. 1, 2011, 5:12 p.m.
Luxury handbag stalwart Coach will relocate its offices to the Hudson Yards, scooping up approximately one-third of the planned south office tower as a commercial condo in a deal that will give the New York City-based company approximately 600,000 square feet.
Coach will move its corporate headquarters and consolidate three New York City offices into the building by 2015. The 1.8 million-square-foot tower, at the northwest corner of West 30th Street and Tenth Avenue, is one of 14 residential, commercial and retail assets envisioned by the Related Companies at its far West Side development site.
“Since its founding 70 years ago, in a loft not far from here, Coach has been a recognized leader in fashion accessory design and production,” said Mayor Bloomberg during a groundbreaking earlier today attended by Coach execs and Related officials. “Now, by announcing its intent to anchor a major new Hudson Yards office tower, being developed by the Related Companies, Coach is also leading the way into New York’s future.”
Coach currently owns its offices at 516 West 34th Street, plus another small building that adjoins it—approximately 250,000 square feet combined, a source said. The company also leases office space at 450 West 33rd Street, which expires in 2015.
CBRE Chief Executive Mary Ann Tighe, who represented Coach in the transaction alongside Vice Chairman Greg Tosko, noted that the handbag purveyor’s 34th Street building will be a hot commodity, now that it’s hit the market, because of its zoning.
“They can build very tall buildings on those sites,” said Ms. Tighe. “If I were a betting person, I would bet it would [be developed as] a residential tower.”
Related Companies will also move its offices to Hudson Yards, Chief Executive Stephen Ross announced at the press conference attended by Bloomberg and an assortment of other politicians and real estate industry leaders. It is not yet known which tower Related will occupy, or how many feet they will take, a spokesperson for Related said.
Coach has been in the neighborhood for decades and in Manhattan for 70 years. They began planning to consolidate their offices more than four years ago but ultimately chose the Hudson Yards complex for its proximity to the High Line Park, Ms. Tighe said.
Tenants who take advantage of leasing the first five million square feet of commercial space at the complex will receive a 40 percent break in “pilot payments,” while those inking deals for the next five million feet will get a 25 percent break, said a spokesman for the Related Companies. These tax abatements are good for 15 years, the spokesperson said.