Time Inc. May Join Media Exodus to Lower Manhattan
March 20, 2014

Time Inc., with its stable of magazines, lavish offices and steady profits, has been a fixture in Midtown Manhattan for more than 75 years and the nation’s premier magazine publisher.

But the company is now close to a deal to move its namesake Time magazine and 20 other brands downtown, joining a growing list of media corporations in or coming to the area, including Condé Nast, American Media Inc., HarperCollins, The Village Voice, The Daily News and XO Group.

Real estate and media executives familiar with the negotiations note that Time Inc. has not signed a lease yet and the deal could still collapse. But they say the company has focused its search for a new home on 225 Liberty Street, in the Brookfield Place office complex at Battery Park City, bypassing other possible locations, including 4 World Trade Center and 85 Broad Street.

In a reflection of the changes underway in Lower Manhattan, Time Inc. would move Time, People, Sports Illustrated, Essence, Fortune, Travel+Leisure and its other magazines into a 44-story tower once occupied by the investment bank Merrill Lynch, which was bought by Bank of America during the 2008 financial crisis.

“There is a new vibrancy and an old logic to Lower Manhattan,” said Jessica Lappin, the president of the Alliance for Downtown New York. “There isn’t a better connected part of the city when it comes to transportation, access to the waterfront and the growing food and retail revolution going on down here.”

Lower Manhattan has recently become a lower-cost alternative to Midtown for tech, advertising and media companies, as well as law firms. The average asking rent downtown is $25 less per square foot, a saving of about $2.5 million a year on a lease for 100,000 square feet.

In addition, tax breaks and other subsidies are available to many tenants who make the leap to Lower Manhattan...

Time Warner, which is in the process of spinning off Time Inc. as a separate company, hired Studley, a real estate broker, to assess the needs of both companies. In January, Time Warner announced its own plans to move its headquarters from Columbus Circle to a new skyscraper on the Far West Side of Manhattan.

If Time Inc. moves downtown, it will occupy about 650,000 square feet, or roughly a quarter of what it once had at Rockefeller Center, real estate executives said. If Time Inc. departs, the owner of the Time & Life tower would renovate it and presumably offer a new tenant naming rights. Teri Everett, a spokeswoman for Time Inc., said, “We haven’t made a final decision yet.”

The shrinkage is also part of a fast-moving trend, in which companies are squeezing more employees into less space. The average amount of space per office worker has dropped to 150 square feet, from 225 in 2010, according to CoreNet Global, a commercial real estate association.

Even the banks that remain downtown are shrinking. Bank of New York Mellon, for instance, is selling its 1.1-million-square-foot headquarters on Wall Street and looking for a far smaller space, about 350,000 square feet.

Time Inc. May Join Media Exodus to Lower Manhattan

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