LinkedIn Expands and Starbucks Moves Offices to Empire State Building
By Rebecca Baird-Remba October 26, 2023 4:20 pm
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LinkedIn is expanding at the Empire State Building once again, while Starbucks is planning corporate office space in the Art Deco tower.
The professional networking site inked a 10-year, 143,778-square-foot lease at the 102-story skyscraper at West 34th Street and Fifth Avenue, landlord Empire State Realty Trust announced in its third-quarter earnings call.
As part of the deal, LinkedIn relocated 118,646 square feet from tower floors to base floors within the building and added another 25,132 square feet, bringing its total footprint in the Empire State Building to 526,541 square feet.
The Microsoft-owned company has been in the Empire State Building since 2011 and gradually expanded its footprint across multiple floors. Back in 2019, it added 188,653 square feet on the 24th floor and three floors in the base of the tower, bringing its space to just over half a million square feet.
But, even as LinkedIn is growing its offices, the company is downsizing other parts of its business. LinkedIn just cut 700 people from its finance and human resources groups amid slow revenue growth, CNBC reported last week, following a layoff of 10,000 employees earlier this year.
“Our track record of tenant retention and expansions is the result of excellent work by our team to provide service to our tenants, and this is not just effort, it’s results,” Thomas Durels, ESRT’s executive vice president of leasing, said during Thursday’s earnings call.
In a separate deal, coffee slinger Starbucks signed an 11-year, 24,640-square-foot office lease at the Midtown South icon, ESRT noted in the earnings report.
The Seattle-based retailer will move its only New York City office from 370 Seventh Avenue, also known as 7 Penn Plaza. The ubiquitous coffee chain already has a presence in the Empire State Building, a 23,000-square-foot Reserve roastery that spans three floors at street level.
Starbucks signed that retail deal back in April 2020 but delayed opening the store until November of 2022. It has been a retail tenant in the building since 2008, but the Reserve lease was a significant expansion of its previous retail footprint.
“Starbucks has grown from our original retail store in a lobby of a building we no longer own in the 1990s, all the way to a remarkable, three-level, 23,000-square-foot Reserve that opened in late 2022, to this new full-floor office lease,” Anthony Malkin, ESRT’s president, CEO and chairman, said during Thursday’s earnings call.
ESRT’s spokespeople did not respond to questions about brokers involved. However, they did say that asking rents in the historic skyscraper range from $69 to $87 per square foot.
CBRE’s Sacha Zarba, Lauren Crowley Corrinet and Christopher Hogan represented LinkedIn in the deal and declined to comment via a spokesperson.
Across its Manhattan office portfolio, ESRT inked 18 office deals totaling 235,000 square feet in the third quarter, bringing those properties to 92 percent leased. The LinkedIn and Starbucks deals account for two-thirds of the leases signed in the real estate investment trust’s properties in the third quarter.
Rebecca Baird-Remba can be reached at rbairdremba@commercialobserver.com.
