General Assembly, a tech-focused continuing education startup, has signed a 10-year lease renewal for its 40,000-SF space at ABS Partners’ 915 Broadway, according to The Real Deal. With Manhattan’s average office lease term shortening by 11% from the previous year, questions continue to swirl about the future of the 10-year lease.
Dig Deeper: The average amount of free rent that office landlords are offering to secure long-term leases jumped 12.5 months nationally in Q1. That was a 29% increase from a year earlier, according to CBRE.
TI’s holding up: While free rent has increased, tenant-improvement allowances have stayed steady for an average of roughly $70 to $75 per SF nationally. A report from Moody’s Analytics predicts effective rents will decline 7.5% this year and that the sector’s recovery will take longer than expected.
Hybrid model is the future: Along with its office at 915 Broadway, General Assembly has also maintained offices and classrooms at nearby 902 Broadway and 35 East 21st Street, but chose not to renew the 30,000-SF space, as the company consolidates its operations, TRD noted. Other tenants in the 250,000-SF building include Charles Schwab, fintech company dv01, and PR firm Full Picture.
Brokers: ABS handled the deal in-house via James Caseley and Carol Sacks. Bert Rosenblatt of Vicus Partners represented General Assembly.
Heard on the Street: General Assembly’s CEO Lisa Lewin: “In the post-pandemic future, we believe that a hybrid model combining on-campus collaboration with flexible, live online learning is the way forward.”[TRD+CBRE+GlobeSt+CO]