Chubb Leases 10 Floors At Former Sony Bldg In Manhattan
USA – Swiss insurance firm Chubb has agreed to be a major tenant at Manhattan’s former Sony Building, which is now known as 550 Madison Avenue, reported Bloomberg on Friday evening (19 November, SGT).
In particular, the insurance provider is leasing 10 office floors collectively measuring 240,000 sq ft at the 41-storey commercial property for more than 10 years. The office space being rented translates to over 30 percent of the available office space at 550 Madison Avenue, according to landlord Olayan Group, a Saudi Arabian investment company.
The newly-leased office space will serve as Chubb New York headquarters, and the insurance firm will relocate there from its existing office close to Times Square once the former is ready next year.
Notably, Olayan has invested US$300 million to refurbish the office building. The renovations include the addition of motion sensors, hospital-level filtration systems, and a library curated by high-end publisher Assouline. The building will also feature a garden with hundreds of plants, including 50 full-grown trees
The new leasing deal comes as Manhattan’s office sector has been significantly impacted by the COVID-19 pandemic. Businesses re-assessed their office space requirements amidst the prevalence of hybrid work arrangements, while office stock has exceeded demand.
Although rental deals have slightly increased in the last few months, rental deals are still below pre-COVID averages.
Nonetheless, newly built or renovated office buildings – like 122 Fifth Avenue, where Microsoft recently agreed to lease, as well SL Green Realty’s One Vanderbilt – have the competitive edge over ageing office towers.
“The activity we’re having is disproportionate to the market because of the product it is. I don’t think there’s a ton of product available that’s a building like this. One Vanderbilt is leased, Hudson Yards is leased, commented Olayan America’s Managing Director for real estate, Erik Horvat.
It can be recalled that a joint venture (JV) led by Olayan Group acquired 550 Madison Avenue in 2016 for over US$1.4 billion. Since opening in 1984, the office tower has accommodated just 2 firms, namely AT&T and Sony.