New York University Revealed as 1.1M-sf Lessee at 770 Broadway

The post-pandemic period brought several announcements by major technology firms of plans to downsize, including Facebook. Decisions earlier this year by Facebook parent company Meta resulted in a downsizing of its footprint at 770 Broadway to about 500,000 square feet following decisions to not renew 275,000 square feet of space under a lease that expired in June, pushing vacancy higher at the approximately 1.2 million-square-foot building. However, two months later, the reported announcement of a “handshake” deal for long-term master lease with an unidentified “user” being reached by landlord Vornado Realty Trust delivered welcomed news. More than 1 million square feet of office space within the Greenwich Village property would be covered under the master lease, with Vornado retaining the 82,000 square feet of retail space spanning the ground and lower levels currently occupied by Wegmans under a 30-year lease secured in 2021. Recently, New York University (NYU) has been identified as the lessee, having agreed to lease 1.1 million square feet of office space; and as part of the deal has the option to buy the building in the 30th and 70th year of the lease. Although full details of the yet to be finalized deal were not released, NYU will pay an undisclosed portion of the rent upfront – but it will be enough to “allow Vornado to pay off its $700 million loan on the property. The REIT also indicated that the master lease is “envisioned to start in January and last for at least 70 years.” According to reported details from a Vornado filing, “Meta Platforms and Yahoo paid an average of $113 per square foot last year,” suggesting that a similar rent would suggest about $125 million in annual rent revenue.

Source:    https://www.crainsnewyork.com/real-estate/nyu-lease-most-vornados-770-broadway