By Barbra Murray, Contributing Editor
New York—The spotlight turns to Manhattan’s West Side as Coach Inc. commences its multi-phase relocation to its new global headquarters at Hudson Yards, the groundbreaking $20 billion mixed-use project being developed by Related Cos. and Oxford Properties Group. The luxury accessories and lifestyle brands company will occupy 700,000 square feet at the project’s 1.8 million-square-foot 10 Hudson Yards office high-rise.
Coach, which acquired a condo interest in 10 Hudson in 2013, will ultimately relocate a staff of 7,000 from its current home base at 516 W. 34th St. in Midtown Manhattan. It’s a high-profile move to an even higher-profile property, as the 17 million-square-foot Hudson Yards project is the largest private real estate development in the nation’s history, as well as the first quantified community in the country. Given Hudson Yards’ status as a revolutionary endeavor, the West Side—an area just outside of Midtown’s core—has been getting a great deal of attention, and the first phase of Coach’s move makes the transformation of the submarket that much more real.
“In just a few short years, Hudson Yards will be home to a collection of the world’s most innovative businesses, vibrant retail and restaurant offerings, some of the City’s finest residences and a new network of public spaces. Hudson Yards is destined to become the new heart of New York and it is well on its way to realizing that vision,” Stephen Ross, chairman of Related, said in a prepared statement.
With big office tenants like Coach and L’Oréal USA, which leased 400,000 square feet at 10 Hudson for its corporate headquarters in 2013, Hudson Yards is turning heads. The 28-acre development is also leading the West Side’s emergence as a hub for the TAMI (Technology, Advertising, Media, Information) set. As commercial real estate services firm Newmark Grubb Knight Frank confirms in a first quarter report, “TAMI tenants have been active in the Far West Side submarket, where the development activity at Hudson Yards has attracted large creative firms.”
At 10 Hudson alone, those who committed to the 52-story tower early on include software firm SAP, which staked a claim to the building’s top four floors with the singing of a 115,000-square-foot lease in 2013. Last year, VaynerMedia announced it would move its corporate headquarters to an 88,000-square-foot space in the skyscraper.
And there’s room for more TAMI tenants (and others) at Hudson Yards. While 10 Hudson is nearly 100 percent leased, the gargantuan mixed-use development will ultimately feature a total of 6 million square feet of office space. The TAMI sector is not a bad group to target. As noted in the NGKF report, TAMI employment in New York City increased 5.4 percent year-over-year in 2015, a figure substantially higher than the financial industry’s growth rate in the city. Additionally, TAMI businesses are a favorite among landlords, as those that survive usually expand, and expansions increased 71 percent from 2014 to 2015.