Cybersecurity Firm Fortinet to Purchase 548 West 22nd Street for $50M

Cybersecurity firm Fortinet will purchase a Chelsea building for about $50 million to use for its own offices.

Fortinet, which develops and sells security software and detection systems, is in contract to buy the property at 548 West 22nd Street from Atlas Capital Group, the company said.

The company intends to house its offices in the four-story, 38,100-square-foot building, according to The Real Deal, which first reported the news.

“Fortinet continues to expand our footprint across the United States and has a strong customer base in the greater New York City area, making it a strategic place to invest and further grow our enterprise presence to best protect and serve our customers in the surrounding area,” John Whittle, chief operating officer at Fortinet, said in a statement to Commercial Observer.

SERHANT‘s Bernadette Brennan, Ariel Sassoon and Ryan Serhant brokered the deal for both the buyer and seller.

“This transaction underscores Chelsea’s evolution from an art gallery haven to a thriving tech hub, home to innovators like Google and now its newest neighbor, Fortinet,” Brennan said in a statement to CO. “It also highlights a significant shift with companies increasingly opting to buy instead of lease, further solidifying the area’s status as a prime destination for innovation and growth.”

A spokesperson for Atlas did not immediately respond to a request for comment.

It’s unclear when Atlas bought the Chelsea property, as the most recent deal listed in city records shows Property Markets Group acquiring the site for $40 million in 2014.

The building was then put up for sale with an asking price of $68 million in January, according to TRD.

Current tenants of the building between 10th and 11th avenues are art center New Art Dealers Alliance, theater production Santa’s Secret and art gallery Shah Garg Foundation. It’s unclear whether the tenants will remain in the building once Fortinet’s purchase is complete.

The California-based Fortinet currently has its New York City offices at One Penn Plaza, and it’s unclear if it plans to keep that space after it moves into 548 West 22nd.

The sale is the second large-scale one in Chelsea in as many weeks. The Westover Companies just bought a 13-property multifamily portfolio of 147 units from Black Spruce Management for $94.5 million, as CO previously reported. The 98,000-square-foot portfolio of buildings is located on the west side of Chelsea between West 19th and West 29th streets.

And Fortinet joins a growing number of tenants taking advantage of the lower prices of commercial properties to buy a building to house its offices instead of leasing space, joining the ranks of Prada, Kering and FedEx.

Isabelle Durso can be reached at idurso@commercialobserver.com.