Fox, News Corp Sign Long-Term Office Leases for Midtown Manhattan

Mr. Murdoch, whose family has large stakes in both News Corp and Fox Corp., in October proposed a deal that would merge the media companies after nearly a decade of separation. Each company’s board has set up a special committee to consider the deal. 

The lease renewals are an encouraging sign for Manhattan’s office market, where vacancy shot up during the Covid-19 pandemic and nearly 17% of space is now available for rent, according to real-estate firm

Colliers.

Office leasing in the borough last year was down 12% compared with the 10-year rolling average of annual leasing volume.

Some businesses, including technology companies, law firms and financial firms, continued to add Manhattan office space even during the pandemic, often paying premium rents for floors in state-of-art buildings located near transportation hubs. Older buildings in Midtown have had less success and many are struggling to attract tenants. 

Corporate tenants are vacating hundreds of thousands of square feet on the Avenue of the Americas as a number of firms decamp to newer office buildings with more amenities and outdoor space and fewer carbon emissions. 

Still, Avenue of the Americas—known as “corporate row” for its long stretch of skyscrapers housing corporate headquarters—has held up better than many of the other avenues in midtown, said Frank Wallach, an executive managing director of research and business development at Colliers. 

Many of the office towers were built in the years following World War II and are starting to show their age, but the office corridor’s availability increased only slightly to 11% during the pandemic from 9.2% in early 2020, Mr. Wallach said. 

The area offers a central location near major transportation hubs, renovations some landlords made years before the pandemic and rents that are much cheaper on average than at new office towers like Hudson Yards and One Vanderbilt. 

“Avenue of the Americas for much of the last several quarters, if not several years, has been one of the strong performers in the Midtown avenues corridor,” Mr. Wallach said.

News Corp and Fox occupy more than half of the 2 million square feet in the 44-story office tower at 1211 Avenue of the Americas, which opened in 1973. The new leases run through 2042 and include renovations to the lobby and the outdoor plaza where Fox News hosts holiday events, election coverage and other broadcasts, according to Ivanhoe Cambridge. There will also be interior upgrades, including to the building’s electrical system. 

News Corp is the parent company of Dow Jones, publisher of The Wall Street Journal, as well as HarperCollins Publishers and news organizations in the U.K. and Australia. Fox Corp. owns Fox News and the Fox broadcast network, along with local TV stations and the Tubi streaming service.

The transaction was brokered by real-estate firm

CBRE,

which represented Fox and News Corp. 

Mr. Murdoch, whose family has large stakes in both News Corp and Fox Corp., in October proposed a deal that would merge the media companies after nearly a decade of separation. Each company’s board has set up a special committee to consider the deal. 

The lease renewals are an encouraging sign for Manhattan’s office market, where vacancy shot up during the Covid-19 pandemic and nearly 17% of space is now available for rent, according to real-estate firm

Colliers.

Office leasing in the borough last year was down 12% compared with the 10-year rolling average of annual leasing volume.

Some businesses, including technology companies, law firms and financial firms, continued to add Manhattan office space even during the pandemic, often paying premium rents for floors in state-of-art buildings located near transportation hubs. Older buildings in Midtown have had less success and many are struggling to attract tenants. 

Corporate tenants are vacating hundreds of thousands of square feet on the Avenue of the Americas as a number of firms decamp to newer office buildings with more amenities and outdoor space and fewer carbon emissions. 

Still, Avenue of the Americas—known as “corporate row” for its long stretch of skyscrapers housing corporate headquarters—has held up better than many of the other avenues in midtown, said Frank Wallach, an executive managing director of research and business development at Colliers. 

Many of the office towers were built in the years following World War II and are starting to show their age, but the office corridor’s availability increased only slightly to 11% during the pandemic from 9.2% in early 2020, Mr. Wallach said. 

The area offers a central location near major transportation hubs, renovations some landlords made years before the pandemic and rents that are much cheaper on average than at new office towers like Hudson Yards and One Vanderbilt. 

“Avenue of the Americas for much of the last several quarters, if not several years, has been one of the strong performers in the Midtown avenues corridor,” Mr. Wallach said.

News Corp and Fox occupy more than half of the 2 million square feet in the 44-story office tower at 1211 Avenue of the Americas, which opened in 1973. The new leases run through 2042 and include renovations to the lobby and the outdoor plaza where Fox News hosts holiday events, election coverage and other broadcasts, according to Ivanhoe Cambridge. There will also be interior upgrades, including to the building’s electrical system. 

News Corp is the parent company of Dow Jones, publisher of The Wall Street Journal, as well as HarperCollins Publishers and news organizations in the U.K. and Australia. Fox Corp. owns Fox News and the Fox broadcast network, along with local TV stations and the Tubi streaming service.

The transaction was brokered by real-estate firm

CBRE,

which represented Fox and News Corp.