Miami’s office market continues to be dependent on coworking firms to fill their spaces, but some landlords are concerned that their absorption rate is becoming too much.
WeWork signs 236,000 square foot lease near Bryant Park
WeWork has signed a lease for 236,000 square feet of office space at 1440 Broadway, a building owned by CIM Group in Manhattan.
The company will take over about one-third of the building and receive a newly constructed private entrance and lobby with elevator access to its space on floors 14 through 21.
Granit Gjonbalaj, chief real estate development officer at WeWork, said that the demand for more locations around Bryant Park led the company to expanding their offices in the area. Now, they have over ten locations close to the park and the newest one will be the largest.
CIM acquired the 747,000-square-foot office building from New York REIT for $520 million in December 2017 and is currently renovating it to include a new roof deck that will offer views of Bryant Park, Times Square, and the Hudson River.
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“Coworking space has surprised nearly everyone. The proliferation of shared office space has been impressive. Its current pace of expansion is unsustainable, though,” said Joe Genovesi, executive managing director of Savills Studley. “At some point, even without the test of a recession, this sector will reach a saturation point, spurring some retrenchment.”
Shared office spaces are clearly growing rapidly, but will not grow at the pace as once predicted. Savills Studley observed that services provided by coworking operators can’t be specifically tailored for a tenant as their own services would be.
Still, coworking should reach 2% of New York’s office stock by the end of the year.
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