NY tech firms are expanding—and outgrowing office space. The New York Observer reports that Midtown South—where most of the new tech and media companies reside—has the lowest vacancy rates in the U.S. Companies looking to expand are forced to move farther uptown. Soho-based 10Gen just signed a lease at 229 W. 43rd St. (the former NYT building) for 30,000 square feet with the option to lease 34,000 more.
Greg Taubin, executive managing director for Studley, told the Observer that if the building were located 20 blocks south, it would be full. Facebook and Microsoft are also scouting the neighborhood for space. The demand is spiking rents higher; 2012 asking rents are up 12.1 percent year over year—four times as much as Midtown.