The model for small and shorter-term leasing has been a bit of a moving target, despite WeWork’s meteoric rise.
The co-working provider recently announced a new program to work with brokers to lease space at its facilities.
And the William Kaufman Organization, through its leasing arm, Sage Realty, is trying out a model that Sage CEO Jonathan Iger says is unlike anything he’s aware of in the city.
Sage is piloting a program at 767 Third Ave to simplify leasing transactions and allow shorter lease terms. The building had some leases roll recently, Jonathan tells us, and the firm used the opportunity to add a series of new amenities like an outdoor sundeck.
“We don’t see this as competing with co-working spaces,” Jonathan says. “Maybe you need your own office space, you’re growing, maybe you need something more private than co-working offers, or maybe you raised your series A funding, and you need to portray yourself as a stand-alone company.”
Part of the point, Jonathan says, is to help make companies’ introduction to the market as painless as possible.
Instead of a 140-page lease that can take three to four months to negotiate, he says, through the new program tenants can lease a space as small as 250 SF and as large as 3,600 SF in about three weeks, and the lease is about 25 pages long.
“That’s more like a document someone might read every day,” Jonathan says. “You can read it after dinner one night.”
Rents will be no different on a PSF basis through the flexible leasing program than rents in the portions of the building that offer more conventional leases—between $66/SF and $81/SF.
The tenants using the program so far don’t exactly read like a list of startups. Athena Communications and Goldman Capital each have spreads of around 1,500 SF.
Sage has plans to expand the program to other properties in Manhattan, depending on how it goes at 767 Third Ave.
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