Presented By: Breather
NKF Brokers Win Breakout Broker Award for Guiding Peloton to Hudson Commons
Given the enormous popularity of the cycling workout Peloton, it’s little surprise that the company has experienced explosive growth in both users and employees.
When Peloton began searching for new office space in 2018, they required a space that was significantly larger than their existing HQ.
So, they turned to Newmark (NMRK) Knight Frank brokers Ben Shapiro and Benjamin Birnbaum, whose deep understanding of the New York office and retail markets has guided Peloton since their inception.
The resulting deal finds Peloton preparing to move into seven floors at Hudson Commons, at 441 Ninth Avenue, and makes Shapiro and Birnbaum winners of the Breakout Broker Award presented by Breather, which recognizes brokers who went above and beyond the norm to close a challenging or unique deal.
Birnbaum, a vice chairman and retail specialist at Newmark Knight Frank, one of the world’s leading commercial real estate advisory firms, began his career with the firm in 2007. In that time, he’s completed over a billion dollars’ worth of transactions, including guiding the retail roll-outs of Watches of Switzerland, CityMD and Peloton.
Birnbaum met Peloton founder and CEO John Foley when the company was still just an idea.
“I first had the pleasure of working with John as he was building the company,” said Birnbaum. “Fast forward a few months, we helped him to sign their first location for their current studio and production facility at 140 West 23rd Street.”
After helping the new company find its 5,000-square-foot studio space, NKF dove in to identify the ideal office space for them as well.
For this, NKF’s Executive Managing Director Ben Shapiro took over. Shapiro has been with NKF since 2013 (and has been a good friend of Birnbaum’s since college). He has worked on behalf of institutions such as The Blackstone Group, Trinity Church and The New York Times Company, among others.
Shapiro secured a 9,661-square-foot office space for Peloton at 158 West 27th Street in 2014. The company was growing so fast, though, that they needed a much larger space just one year later. They continued to grow and quickly saw themselves leasing more than 64,000 square feet at 125 West 25th Street. At this time, Shapiro and Birnbaum also secured Peloton a retail space at 5 Manhattan West for their new super studio (for this transaction they were awarded The Most Ingenious Retail Deal of the Year award from the Real Estate Board of New York).
In early 2018, Peloton’s growth showed no sign of slowing down and they were in need of their biggest space yet. Shapiro and Birnbaum, in collaboration with NKF’s Workplace Strategy & Human Experience team led by Tamar Moy, engaged Peloton’s leadership and employees to learn how to best position their growing headcount, work processes and overall workplace experience, which would ultimately yield an office setting that would occupy over 300,000 square feet.
“They were outgrowing their existing footprint,” said Shapiro. “We understood which departments their head count growth was coming from, the time frame for that growth and what business decisions were driving demand. John Foley has a vision about what type of environment he wants to create. He wants to create the best office space in Manhattan to attract and retain top talent. It was our job, under the leadership of Peloton VP David Deason, to execute on that vision.”
Birnbaum and Shapiro knew early on that Hudson Commons would be a top candidate for the new space.
Originally an eight-story building, Hudson Commons is currently undergoing extensive renovations to its existing floors and adding an 18-story extension, including 300,000 square feet of new office space, that will position it as one of the city’s most desirable office locations.
Once completed, Hudson Commons will have terraces on most levels, 14-foot slab heights, floor-to-ceiling windows and a bike room with showers, something few New York office buildings can claim.
Aside from its convenient proximity to the company’s 5 Manhattan West location, Hudson Commons appealed to Peloton for several reasons.
“Because the building is an eight-story structure with a new 18-story overbuild,” added Shapiro, “you have this confluence of new and old architecture and indoor-outdoor environment highlighted by the ninth floor terrace, which will be the largest outdoor space in Midtown.”
While the renovation will provide Peloton with a world-class home, preparing to move a client during a major building renovation presented unique challenges.
“The renovations made the lease negotiation a bit more complicated,” Birnbaum said. “There are outside dates and construction challenges you have to navigate, and it made the legal process more challenging. However, once we got into discussions, we were able to quickly get comfortable with the construction timeline, as it progressed at a rapid pace. Kevin Hoo and Tom Farrell of Cove Property Group are consummate professionals with an impressive track record.”
In the end, Peloton signed a lease for 313,000 square feet at Hudson Commons, taking the fourth through 10th floors plus basement space. Renovations are expected to be completed later this summer, and the company will move in during the third quarter of 2020.
As they prepare for the big move, the company couldn’t be more pleased with the results.
“We are tremendously excited to be developing our new headquarters at Hudson Commons.” said David Deason, vice president of real estate at Peloton. “From the initial search and review of the NYC market through LOI and Lease negotiations, Ben Shapiro, Ben Birnbaum and the entire NKF team delivered tremendous guidance and expertise in navigating the transaction. The NKF team approached every aspect of this effort from a position of ownership and partnership, which provided fantastic results.”
Birnbaum and Shapiro see the success as indicative of NKF’s versatility: the company’s ability to service its clients across diverse areas of business.
“NKF cultivates entrepreneurship and collaboration to drive client service. What’s important is the ability Ben and I have to leverage the NKF platform for the betterment of our clients,” Birnbaum said. “We are proud of the fact that this started out as a retail assignment, and evolved into a much bigger account we were able to service across multiple verticals within our firm.”
PRESENTING SPONSOR: BREATHER
Revolutionizing access to productive, private flexible office space. Join the Breather Broker Program.