Vornado bags another big lease at Penn 1

Steven Roth’s $450 million worth of work at Penn 1 is producing some returns for Vornado Realty Trust, based on recent leasing activity.

Financial services firm Canaccord Genuity Group signed a lease for 75,000 square feet at the Midtown building, the New York Post reported, citing broker sources. Canaccord is consolidating from two locations and is expected to occupy two of the tower’s 55 floors next year.

The asking rent on the office lease was $103 per square foot, or about $40 more than it was about two years ago.

There’s been a swell of activity at 2.5-million-square-foot Penn 1 in recent months. The nearly half a billion dollars that Vornado spent there went toward new plazas, a curtain wall, refreshed elevators and lobbies, LEED certification and other sustainability and carbon-cutting upgrades, as well 160,000 square feet of food and recreational amenities.

Life Time Group recently leased 53,000 square feet and plans to install pickleball courts.

In May, Samsung signed a deal for 36,000 square feet, which will house its North America ad sales group. Other notable tenants include Dell, Empire Heath, Gusto, Hartford Insurance, Jacobs Engineering, Morgan Stanley and Wells Fargo.

In the last two years, Vornado has signed 800,000 square feet of leases at Penn 1, including renewals and expansions. There’s still plenty of space to be had, however, as 370,000 square feet remains available.

While Vornado works to lease up Penn 1, its grander plans for the area around Penn Station have become increasingly fuzzy. Last month, with the environment for ground-up office development all but frozen, Gov. Kathy Hochul decoupled the redesign of Penn Station from a plan to fund it with 18 million square feet of new commercial space.

Vornado controls most of the sites that were part of the plan. Roth has delayed but not abandoned development in the neighborhood and has said ground-up development will likely come with a multifamily project.

— Holden Walter-Warner

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