Spotify Looks at 73K s/f Deal on Ladies’ Mile
Spotify, the online music streaming service, is looking at a deal to take the entire seventh floor of the office building 620 Avenue of the Americas several sources told The Commercial Observer.
The space, the top floor in the roughly one million-square-foot building, is 73,000 square feet and one of the prime vacancies in the hot Ladies’ Mile submarket of Midtown South.
Bill Elder, leasing director for RXR Realty, the investment company that purchased the building in recent months for about $500 million, said that the space boasted 24-foot ceiling heights, few columns and large skylights that bathe the floor in natural light.
“We thought we were going to have to build a marketing center in the space to convey to tenants our vision but we started showing it and tenants would come in and instantly get it,” Mr. Elder told The Commercial Observer. “We have several interested parties for the floor.”
Mr. Elder couldn’t confirm or deny the deal with Spotify, stating that active negotiations were in process for the floor and that he was prohibited from disclosing any details. Because of the space’s attributes, which are difficult to find in the area, RXR is asking for rents in the $60s per square foot for the floor, what would have once been an unheard-of rate for the neighborhood, which has only come into vogue in recent months.
Spotify currently occupies space at 111 Eighth Avenue, a roughly three million-square foot property at the heart of the burgeoning neighborhood of tech tenants in Chelsea, which has drawn the nickname Silicon Alley because it is emerging as a rival to its larger West Coast counterpart.
Google purchased 111 Eighth Avenue at the beginning of 2011 for roughly $2 billion and has been clearing the property of tenants as leases expire in order to take over the space for its own operations. Spotify occupies offices at the property under a sublease so it’s not being pushed out directly but likely would not have the option to renew at the building. For months, it has been listed by leasing brokers as one among a large handful of prominent tech companies scouring the market for space in which to relocate.
Nick Farmakis, an executive at Studley, is representing Spotify in its search with other Studley executives. Reached by phone in his office, he said that he could not comment on the company’s search.