BlackRock to pay $1.25 billion over 20 years for New York headquarters

BlackRock Inc (N:BLK) will initially pay about $60 per square foot in rent for its future headquarters in the Hudson Yards district on the far west side of midtown Manhattan, the company said in a filing on Thursday.

BlackRock, which oversees $5.4 trillion in assets and is the world’s largest asset manager, is moving into 847,000 square feet (78,690 sq meters) of a development that will be part of a neighborhood rising over rail yards and tracks in a once-forlorn corner of New York City.

The company said in the filing with the U.S. Securities and Exchange Commission that it will pay $50.8 million per year in the first five years, and an increasing amount after that, for a total $1.25 billion over 20 years.

That works out to about $60 per square foot to start, and nearly $74 over the full term of the lease for the offices at 50 Hudson Yards. The company also will be responsible for its operating expenses at the building and a share of property taxes, which will add about $30 a square foot to the lease, a source with knowledge of the transaction said.

The lease is one of the largest ever in Manhattan in terms of size and value of the overall contract.

The average asking rent in April for midtown Manhattan office space was $84.09 a square foot, according to Cushman & Wakefield. Along Park Avenue, near where BlackRock is currently located, asking rents averaged $91.13 a square foot.

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