Jay Suites, a shared office provider, has signed a 90,000-square-foot sublease for the entire 12-story building at 15 West 38th Street from sublandlord Hudson’s Bay Company for its eighth and largest location, according to a press release from Jay Suites.
The company will build a 22,000-square-foot conference center in part of the first floor and the entire second and third floors of the building between Fifth and Sixth Avenues. And its first-ever branded Jay Café will be in roughly 600 square feet on the ground floor. Floors four through 12 will be 150 private offices.
The location will also have a rooftop terrace and Jay Suites is planning to relocate its headquarters with 25 employees to the building’s penthouse from its current offices at 369 Lexington Avenue between East 40th and East 41st Streets, where it launched its corporate offices and its first location in 2009.
Jay Suites’ new location is expected to open in the summer.
Jack Srour, co-founder and COO of Jay Suites, added that Jay Suites at 15 West 38th will provide a variety of professional services and shared amenities. The new Jay Cafe will offer an elegant espresso bar with flavored coffees, teas and pastries for members to meet and eat on the retail level for easy accessibility. The 2nd and 3rd floors will comprise of a 22,000 square foot Jay Conference center featuring the latest in telecommunications technology. A total of 6 soundproof conference rooms (capacity of 20) will come fully-equipped with large screen TVs, polycom conference phones and unlimited high-speed wifi access. The modular tables with built-in ports for charging, USB, and HDMI inputs, can easily be rearranged to accommodate needs for theatre, crescent, boardroom or classroom-style setup upon request. The on-demand meeting room rentals will include on-site professional administrative and IT support.
In addition to 7 floors of fully-furnished offices and shared workspaces, Jay Suites will introduce the largest corporate event space it has to offer. The exclusive Jay Rooftop terrace can host everything from company happy hours to product launches. Jay Rooftop will serve as the perfect New York City venue with stunning views of the Manhattan skyline, starting from minimum groups of 50 and maxing out at 250 guests. Their on-site event planners will assist in coordinating corporate events from beginning to end. This will mark the third event space the Jay Suites brand has to offer, the others being at their 34th Street and Times Square locations respectively.
Jay Suites continues to improve the workplace experience for their members with appealing amenities and unparalleled hospitality. Location is an important factor when choosing office, meeting and event space, so being just minutes away from Penn Station makes Jay Suites at 15 West 38th Street an easy choice for tri-state commuters.
The tower is owned by Rosen Group. Hudson’s Bay—the parent of various brands such as Lord & Taylor and Saks Fifth Avenue—has 17 years left on its triple-net lease for the property. It was the Canadian company’s U.S. headquarters. Hudson’s Bay relocated to Brookfield Place after signing a lease there in 2014.
Sean Black of BLACKre represented Jay Suites in the deal while Cushman & Wakefield’s Laura Pomerantz and Maria Travlos handled the deal for Hudson’s Bay.
“This deal—with its below-market rent, location and footprint—will let Jay Suites offer its core private luxury office spaces with a full suite of amenities as well as flexible larger team and conference rooms to New York City companies for excellent value,” Jack Srour, the co-founder and COO of Jay Suites, said in a prepared statement. “The deal also benefits Hudson’s Bay Company as its need for underutilized space shifts.”
The asking rent was $45 per square foot, according to The Real Deal. The New York Post was the first to report on the news.
Going to 15 West 38th Street puts Jay Suites in a direct competition with rival WeWork. Nearby is the Lord & Taylor building at 424 Fifth Avenue, which WeWork and Rhône Capital purchased for $850 million last year, as Commercial Observer previously reported. The coworking giant plans to open a new share office location and its headquarters in 424 Fifth Avenue.
Jay Suites plans to spend $10 million to renovate the red terra cotta structure at 15 West 38th Street that was erected in 1909. Jay Suites will upgrade and modernize the technology, infrastructure, work, conference space and rooftop building.
Jay Suites has seven active locations all in New York City and 90 percent are occupied. It expects to have 5,000 members, factoring in the new eighth location. It’s previous largest shared office was at 1441 Broadway, where it leased 75,000 square feet.