ReD Associates (ReD), a strategic consulting firm, had experienced steady, organic growth. Having already expanded to occupy the entire 25th floor at 26 Broadway, ReD realized it would soon need more space to accommodate its growth.
InterRelate Group was engaged to explore the overall office market and find a full-floor option with an open, collaborative and creative layout in a historic pre-war building or a new state-of-the-art building.
Course of Action
While evaluating ReD’s existing space, InterRelate discovered that a significant portion of the 25th floor at 26 Broadway was being underutilized. When ReD underwent its prior expansion, the common corridor was left untouched, leaving a large unused open area adjacent to the elevator banks. This left an unusual opportunity: the possibility of restructuring the floor/layout to allow ReD to expand into the common corridor. With strong knowledge of both ReD’s business model and 26 Broadway’s infrastructures, Interrelate helped select an architectural firm that designed several very efficient layouts.
With a redesign of the current space as an option, InterRelate conducted an in-depth survey of the market and uncovered more than twenty alternative properties in the Midtown, Midtown South and Downtown markets.
By leveraging a series of proposals from three potential alternatives and ReD’s existing location, InterRelate was able to achieve excellent transaction terms from all four properties. ReD’s partners opted to renew their lease at 26 Broadway for seven years. The landlord agreed to rebuild their space in conformity with the efficient layout. There were several other key factors that led to ReD’s decision: InterRelate arranged for the owner of 26 Broadway to provide a temporary swing space during the length of the build-out. Secondly, InterRelate was able to negotiate a cancellation clause, which ReD can exercise after year four of the Lease term in the event their continued growth requires further expansion.