Investment advisory firm the Stagwell Group has agreed to take 83,955 square feet of office space at 1 World Trade Center after signing a lease for the entire 62nd and 63rd floors at the Financial District skyscraper.
Stagwell inked a 13-year lease at the 104-story, 3-million-square-foot supertall building. The Washington, D.C.-based company—which was founded by former Microsoft executive Mark Penn in 2015 and owns a portfolio of marketing, advertising, research and communications companies—plans to initially move four of its subsidiaries into the space.
Asking rent in the deal was $69 per square foot, according to Crain’s New York Business, which first reported news of the transaction.
Michael Berg, Howard Hersch and Doug Kauffman of JLL represented the tenant in the deal, while landlords the Durst Organization and the Port Authority of New York & New Jersey were represented by a Cushman & Wakefield team led by Tara Stacom and Durst’s Eric Engelhardt.
While the office is roughly 25 percent larger than needed for the Stagwell operations moving into the space, Penn told Crain’s that the lease enables his company to further consolidate various operations under one roof in the future.
“We are excited to be able to make an amazing new space for digital creatives and will be bringing together a great group of portfolio companies to foster synergies in a dynamic new workspace,” Penn said in a press release announcing the deal.
Jonathan “Jody” Durst, the president of Durst, said in the release that Stagwell “is rapidly expanding its portfolio of companies,” adding that the landlord is “thrilled they have chosen 1 World Trade Center as the location to integrate [its] disparate offices into one location.”
The deal brings 1 WTC to 75 percent leased up, according to the press release, with 160,000 square feet taken at the property in the first half of 2017 alone. Still, the building has roughly 750,000 square feet of space sitting vacant, according to Crain’s, with the bulk of that availability located on its higher-priced upper floors, where asking rents range from $80 to $100 per square foot.
Durst’s Engelhardt said the Stagwell deal is a testament to the “growing and vibrant community of creative companies” at 1 WTC, noting that “more than 15 TAMI [technology, advertising, media and information] companies, from tech startups to fashion icons,” call the office tower home.
A representative for JLL did not immediately provide comment on the transaction. A Cushman & Wakefield spokesman did not return a request for comment.
Downtown Manhattan office asking rents have steadily climbed in recent years and, according to CBRE, hit an all-time peak of $62 per square foot in May—with the area continuing to appeal to TAMI tenants drawn to both the architectural qualities of Downtown’s older building stock and the value proposition of rents priced well below what they could find in the Midtown and Midtown South markets.