Apple has recently signed a lease for an additional 61,000 square feet at the Penn 11 building, which is owned by Vornado Realty Trust.
This expansion boosts Apple’s total occupied space in the Midtown South office to an impressive 460,000 square feet.
Currently, Apple occupies the fourth through fourteenth floors of the 26-story building, located on the eastern side of Seventh Avenue between West 31st and West 32nd streets.
The newly leased area previously belonged to Macy’s, which still runs its headquarters in the same building.
Strategic Alignment with Macy’s Lease
This new lease comes with a strategic alignment to coincide with Macy’s lease, set to expire in 2035.
The current asking rent for spaces in Penn 11 stands at $85 per square foot.
Macy’s, which recently shifted some of its workforce to Queens, initially intended to sublease its existing space.
In a twist of negotiations, Vornado decided to maintain Macy’s financial commitments while creating a direct rental relationship with Apple, effectively keeping both leases intact.
Details of the Expansion
In this deal, Macy’s was represented by Scott Gottlieb from CBRE, while Apple’s interests were overseen by David Endelman of Cushman & Wakefield.
Meanwhile, Vornado’s internal team included Glen Weiss and Jared Silverman.
Apple made its initial entry into the 1.1 million-square-foot building—previously known as the Equitable Life Assurance Building at 11 Penn Plaza—in 2020.
Back then, the tech giant subleased 220,000 square feet from Macy’s, at rental rates in the mid-$60s per square foot, for a six-year term.
Building Enhancements and History
The property itself boasts significant enhancements, including underground corridors that connect to an array of dining options in the adjacent Farley building, where Moynihan Train Hall is located.
Since Vornado acquired the building in 1997, as part of a $437 million portfolio deal from the late Bernard Mendik, Apple has steadily increased its footprint.
The original owner opted to exchange his stake for shares in Vornado’s newly established real estate investment trust.
Constructed in 1923 by the architectural firm Starrett & Van Vleck, the Penn 11 building has undergone extensive renovations that achieved LEED Gold certification.
It features a striking architectural design, characterized by multiple tiers of setbacks.
Both CBRE and Vornado chose not to comment on the deal, while representatives from the firms involved did not immediately respond to requests for information.
Source: The Real Deal