WeWork Signs Full-Building Lease A Block From Its Chelsea HQ
The co-working industry leader has signed a 177K SF lease at 18 West 18th St., and will eventually occupy the entire office portion of the 11-story Chelsea building, Commercial Observer reports. WeWork will occupy 117K SF from the fifth through 11th floors starting this summer, and will fill the three floors below it when the Association for Autistic Children's lease runs out in a few years.
The sizable lease comes on the heels of WeWork President and Chief Financial Officer Artie Minson annoucing the company's intention to double the number of its locations worldwide in 2018 from 200 to 400. In the same announcement, Minson said that WeWork brought in $900M in revenue in 2017, and would have turned a profit if not for its aggressive investment in additional ventures to expand its brand beyond simple co-working.
WeWork retained CBRE as its broker in the lease transaction, while building owner 17-18 Management Co. was represented by Cushman & Wakefield. The 177K SF footprint outpaces its most recent New York deal, which was for 122K SF at the edge of Chelsea and Greenwich Village with the goal of filling it with a single occupant like Amazon at 2 Herald Square or IBM at nearby 88 University Place.
In October, WeWork cleared out its members at 115 West 18th St., a block from its newest lease at 18 West 18th, so that it could dedicate the space as its headquarters — at least until its permanent space above Lord & Taylor's flagship Fifth Avenue store, which it acquired for $850M with Rhône Capital, is ready.
A few blocks north, WeWork CEO Adam Neumann purchased a development site in November with rights to a 243K SF building, though what he plans to do with that property is still unknown to the public. What is for certain is Chelsea's significance to WeWork and the tech industry as a whole.
Not only is WeWork's headquarters in the neighborhood (for now), Google's sizable footprint will soon grow exponentially after it closes on its $2.5B purchase of the Chelsea Market building, across the street from its current New York headquarters on Eighth Avenue.