Convene Adds 23K SF at 360 Madison After etc.venues Acquisition
By Mark Hallum April 8, 2024 5:41 pm
reprints
Convene is growing in Midtown with a 22,519-square-foot expansion at Stawski Partners" class="company-link">stawski partners’ 360 Madison Avenue.
The coworking firm, which specializes in meeting and event space, will now occupy 68,000 square feet across the fourth, fifth and sixth floors after signing a lease for the sixth floor, according to Convene.
Convene did not disclose the asking rent nor the length of the lease, but the average office asking rent for Midtown in the first quarter of 2024 was $82.84 a square foot, according to a CBRE (CBRE) report. Convene plans to take over the new space in the fourth quarter of 2023, the company said.
Etc.venues originally leased 45,000 square feet in the building in May 2019 and it came under Convene’s control in February 2023 when that company acquired the London-based etc.venues. The outpost is still branded under etc.venues but will carry the Convene name starting in early 2025, according to Convene.
While many coworking firms such as Industrious favor partnership agreements with landlords as opposed to the traditional lease — which has proved a complicated matter for WeWork/" title="WeWork" class="company-link">WeWork (WE) as it undergoes reforms under Chapter 11 bankruptcy — Convene’s leaders still see being a tenant itself as the best option for its growth.
“We have a really healthy operating history at this location and, in fact, we were turning down business because we just simply didn’t have enough space,” Brian Holland, head of real estate at Convene, told Commercial Observer. “We don’t expand for the sake of expansion, we expand because we believe that we can be profitable at the location level.”
Holland said Convene is able to make leases work because it offers meeting and event room in its location as a buffer against the narrow margins of essentially subleasing out workspaces.
“You’re selling desks for slightly more than you’re paying in rent to your landlord after signing the lease — for the meetings and events business it is totally different,” Holland said. “It’s a hedge because the economics are so different for meetings facilities, and they are a coworking or workplace facility … We build so much expensive hospitality infrastructure into our meetings facility that no one could ever afford to build in their coworking facility or their workplace facility. We can offer that and let our workplace customers tap into all of that wonderful hospitality infrastructure.”
Rocco Laginestra of CBRE represented Convene in the 360 Madison transaction while it is unclear who negotiated on behalf of Stawski Partners. CBRE and Stawski did not respond to requests for comment.
Other tenants in the 25-story building, designed by COOKFOX Architects and completed in 2017, include real estate attorneys Avenue Law Firm on the ninth floor and Aareal Capital Corporation, which signed a 14,683-square-foot lease in February 2019.
Mark Hallum can be reached at mhallum@commercialobserver.com.
