New York University Expands Its Footprint To Sign The Largest New Office Lease In Five Years

At a time when elite U.S. universities are under pressure from the Trump administration, New York University said it has secured over a million square feet of office space at 770 Broadway in Manhattan’s largest post-pandemic lease.

The agreement with owners, Vornado Realty Trust, will occur in two phases and will see the building transformed into an engineering and tech hub, CRE Daily says.

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Unique Lease

The 70-year lease, valued at $9.3 million per year, according to CRE Daily, offers NYU the opportunity to purchase the building in 2055 and when the lease term ends in 2095. The mixed-use building will bring in an income for NYU as it can also rent out some space, Globe Street says. Supermarket chain Wegmans is a current tenant and is expected to stay. The fate of the other tenants is not clear. Vornado will retain the building’s retail portion, which generally commands higher rents, Globe Street says.

NYU’s triple-net lease means that the university assumes responsibility for taxes, insurance, and maintenance costs. Vornado will retain ownership, Stock Titan reports. The deal gives Tornado $935 million immediately and $9.3 million in annual payments during the lease term.

Stock Titan says the transaction is a win-win for Vornado by using NYU’s $935 million prepayment to pay off the $700 million mortgage it holds on 770 Broadway while retaining around $235 million in capital.

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How 770 Broadway Will Be Used 

NYU plans to transform 770 Broadway into a hub that allows faculty, researchers and innovators to collaborate, focusing on areas such as AI, biotechnology and quantum informational sciences, according to Globe Street.

The university raised $200 million towards redeveloping the building and it expects to save $800 million in rent over 30 years by consolidating operations from different buildings at 770 Broadway, Globe Street say, adding that NYU operates from eight different buildings located around Washington Square Park. 

Tech Competition

In 2022, NYU announced it was investing $1 billion into its engineering school to close the gap on its competition, such as MIT, Carnegie Mellon and Stanford. The new lease is seen as an ongoing effort to place NYU at the center of the city’s burgeoning tech industry. The billion-dollar investment included $600 million slated for NYU Tandon, the university’s engineering school, and $400 million in new funds, the New York Times reported. The university has steadily been purchasing buildings to increase its visibility within the tech arena, such as 3 MetroTech Center, a 10-story building in Downtown Brooklyn where tech companies such as Etsy ETSY and Kickstarter are based, the Times reported. 

Upswing In Office Rentals

NYU’s lease of 770 Broadway comes at a time when sales and leases are both up in Manhattan. In Q1 2025, office leasing was up 59% from the year before.

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