Sony in Talks to Anchor Tishman Speyer’s 99 Hudson Boulevard
Sony is in negotiations to become the anchor tenant of Tishman Speyer’s 99 Hudson Boulevard in Hudson Yards, Commercial Observer has learned, and may already have a term sheet.
Sony’s current U.S. headquarters is in the top 568,000 square feet of 11 Madison Avenue, but Sony, like other corporate occupiers, is looking for newer, bigger and more collaborative workplaces for its employees.
Sony signed a lease in 2013 and moved to 11 Madison after selling its iconic 550 Madison Avenue headquarters in 2012 to Joseph Chetrit for $1.12 billion. Chetrit flipped it three years later for $1.4 billion to Olayan America, which completely redeveloped the tower, which features a distinctive Chippendale-style top designed by Philip Johnson and John Burgee.
While Sony’s current location in vibrant NoMad next to Madison Square Park is hard to beat, there is simply no room to expand in the 30-story building. It was originally designed by Harvey Wiley Corbett and Dan Everett Wade in 1928 to hit 100 stories before the Great Depression stopped its ascent. The Art Deco tower was not completed until 1950 and is currently owned by SL Green Realty.
It’s unclear how much space Sony is in talks for at 99 Hudson Boulevard. Savills’ Erik Schmall and Allyson Bowen are representing Sony in the negotiations, but did not respond to requests for comment.
Tishman Speyer has proposed 99 Hudson Boulevard as a 48-story office building of roughly 1.256 million square feet. Public documents state the firm will start construction on Dec. 1.
The planned tower will sit opposite the Javits Center on 11th Avenue between West 36th and West 37th streets and have unobstructed views of the Hudson River.
Its primary address of 99 Hudson Boulevard would place its main lobby facing the new Bella Abzug Park. Constructed as an all-electric LEED Gold tower, it would not be ready for occupancy until around 2030.
Although architect Henning Larsen and renderings were revealed in 2019, it is highly likely that plans will change to add more space to accommodate Sony’s unique needs and current occupier desires that have changed strategically since the COVID-19 pandemic.
For instance, the company’s current offices at 11 Madison include a 36-seat screening room, a 110-person multipurpose room, and another 74-person multipurpose room with a performance venue. The electronics giant is also synonymous with music, and with Madison Square Garden just a few blocks east, so it might be easy for artists like Bruce Springsteen, Tyla or Megan Moroney to drop by.
Tishman Speyer’s current hiccup is a request to the city’s Industrial Development Agency (IDA) for $92 million in property tax exemptions and mortgage tax recording exemptions. It would instead make payments in lieu of taxes — known as PILOT — to Hudson Yards Infrastructure Corporation, as do the other towers in Hudson Yards.
The vote on the incentive package was bumped to Nov. 17, and there are still some politicians who oppose providing incentives or support for any kind of privately owned property.
Tishman Speyer projects nearly $274 million in direct and indirect taxes will be generated by the tower, along with nearly $583 million from taxes and indirect taxes due to the jobs created in a building that will eventually have around 5,900 building, tenant and service employees.
In its application to the IDA, the developer stated it is also getting a loan of $1.477 billion with equity of $1.2 billion.
Tishman Speyer declined comment.
Source: commercialobserver.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.