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Stream On: Internet Music Providers Ink Major Manhattan Leases

SL Green’s 125 Park Avenue

Two recent transactions completed by two of the web’s biggest names in streaming music demonstrate the persistent strength of Gotham’s growing attraction for technology industry firms. Pandora Media Company – and its Pandora Internet Radio service – has signed a 52,450-square-foot lease at SL Green’s Energy Star-labeled, York & Sawyer-designed 125 Park Avenue. The company will pay $65 per square foot for 10 years and occupy the 19th and 20th floors of the 26-story tower, which dates from 1923 and stands between East 41st and 42nd Streets, just south of Grand Central Terminal. Pandora went public in 2011 and earned revenues of nearly $275 million in 2012. It currently operates a sales office in Union Square and is headquartered in the Bay Area.

Meanwhile, in the white-hot Midtown South submarket, the Sweden-based streaming music service Spotify will open its first North American headquarters on the top floor of the landmarked, 11-story 620 Sixth Avenue (between West 18th and 19th Streets), which dates from 1897. Joined by Mayor Bloomberg in making a public announcement just before the recent July 4 holiday, the company plans to hire 130 new engineers by the end of next year, upping its NYC workforce to nearly 200 employees. It will be Spotify’s largest office outside of its Stockholm headquarters. The new hires will help the company’s New York office create original content, develop Spotify radio stations, and support web development and advertising efforts. Terms of the deal were not disclosed.

620 Sixth Avenue

“Spotify’s decision to expand and grow here in New York City along with its plan to hire 130 engineers underscores the reasons why we’ve made such a strong push to increase the ability for students to study science, technology, engineering and mathematics,” Mayor Bloomberg said in a press release. Ken Parks, Spotify’s chief content officer, echoed those sentiments. “New York City is the engineering hub of our U.S. operations and we fully support Mayor Bloomberg’s efforts to bring more technology and engineering talent to the city,” he said.

There will be many critiques leveled at Mr. Bloomberg’s administration when it wraps up later this year. But the mayor’s dual efforts to position New York City as a leader in both sustainability at the municipal level and as a magnet for technology industry firms will continue to pay dividends for Gotham long after he leaves City Hall. From Cornell Tech on Roosevelt Island to plans for the Brooklyn Tech Triangle, technology firms – like Pandora and Spotify – will continue to find good reasons to do business within the five boroughs. And the types of younger, progressive workers they aim to attract increasingly value high performing, sustainable office space. From those two perspectives, New York City’s future is bright indeed.

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