TikTok Signs Lease For First D.C. Office Near Union Market
Social media platform TikTok's viral growth has led it to open its first office in the nation's capital.
TikTok's China-based parent company, ByteDance, has signed a lease for around 50K SF at Signal House, a new office building near Union Market in Northeast D.C., multiple sources tell Bisnow.
Carr Properties speculatively developed the 215K SF Signal House at 1255 Union St. NE and finished construction this year without a signed lease before securing TikTok as an anchor. Sources tell Bisnow TikTok is taking the first two floors of office space and a portion of the ground-floor retail space, and the lease term is at least 10 years.
TikTok, a video-based social media app that is especially popular among young people, has grown rapidly in recent years. The company announced in September it surpassed 1 billion monthly users, up from 507 million in December 2019 and 55 million in January 2018, CNBC reported.
The space could be used for a TikTok Transparency Center in D.C., which the company announced plans to open in a June 2020 blog post after previously announcing a similar facility in Los Angeles. In a September 2020 blog post that referred to the facilities as "Transparency and Accountability Centers," TikTok said it has evolved its plans to offer a virtual experience until it can open the physical locations. It hasn't said when the physical locations would open or where D.C.'s facility would be located.
TikTok Head of U.S. Public Policy Michael Beckerman wrote in the September 2020 blog post that the goal of the Transparency Centers is "for experts and lawmakers to see first-hand how we're working to build a safe and secure platform for our growing and diverse community." He added that nearly two dozen experts and congressional offices have used the virtual Transparency Center experience.
Carr Properties declined to comment. Its leasing representatives for the building, Avison Young's Jonathan Wellborn and Eli Barnes, also declined to comment. A ByteDance spokesperson didn’t respond to a request for comment.
The word of TikTok planning to open an office near Union Market had already reached other real estate firms in the neighborhood. JBG Smith said in a public investor filing earlier this month that an apartment building it acquired, The Batley, is "easily walkable from significant office tenants such as ByteDance (TikTok’s parent company)."
The REIT didn't specify where ByteDance's office is located, but the Signal House building is one block from The Batley and is one of the only buildings in the area with large blocks of available office space.
The building has 214.5K SF of offices across 10 floors and a penthouse, according to its website. Carr Properties CEO Oliver Carr told Bisnow in September that the building delivered earlier this year, and while the firm hadn't announced any signed leases, he said it had "a lot of leasing activity in process."
TikTok has offices in Los Angeles, New York, London, Paris, Berlin, Dubai, Mumbai, Singapore, Jakarta, Seoul and Tokyo, according to the website of its parent company, Beijing-based ByteDance. The company has a handful of employees whose LinkedIn page lists them as located in D.C., and a source tells Bisnow they are currently located in a coworking space.
The company doesn’t mention a D.C. office on its website, but its careers page lists 69 job openings that are based in D.C. Of those 69 openings, 55 are in the “R&D/ Security” job category, nine are in the “Operations” category, three are in the “Marketing/PR” category and two are in the “Corporate Function/Support” category.
The social media company’s Chinese ownership has sparked privacy and security concerns among U.S. officials. Then-President Donald Trump last year said he would ban TikTok unless it sold to an American company, but the attempted ban was blocked by a federal judge. President Joe Biden's administration in February signaled it was backing away from the efforts to ban the app.
Other tech companies such as Amazon, Facebook and Google have grown their D.C. office presence over the last several years as they have faced increasing scrutiny from the federal government.
The TikTok lease represents a major win for the Union Market area, which has rapidly developed in recent years around the popular food hall. Several new apartment buildings have been built in the neighborhood and a host of restaurants and retailers have opened, but Signal House was the first major office delivery around Union Market, and it had remained vacant upon delivering. The TikTok deal will bring the building a brand-name tenant with a workforce that could provide daytime traffic for its businesses and leasing demand for its apartments.
NoMa Business Improvement District CEO Maura Brophy, who didn't have independent confirmation of the lease, said she was excited to hear the report of a major new tenant coming to the neighborhood. The NoMa BID boundary ends at Florida Avenue NE, one block south of the Signal House building, but Brophy said she considers the NoMa and Union Market areas one large neighborhood.
"I think overall news like this is further validation that neighborhoods like NoMa that have a healthy mixture of uses in office, residential space and retail amenities will be the types of neighborhoods that are post-pandemic neighborhoods of choice," Brophy said. "We had seen trends for some time pre-pandemic that activity in the city is shifting further east. As we hear news of new office tenants, as we see numbers around population increasing, it further validates that activity is shifting east. "