Lois Weiss

Lois Weiss

Real Estate

Apple eyes 11 Penn Plaza for new office space

After losing to Facebook in a tug-of-war over the historic Farley Building, tech giant Apple is negotiating to lease office space at 11 Penn Plaza, sources said.

The 1.15-million-square-foot building owned by Vornado has 638,921 square feet available from the fourth through 14th floors as a sublease from Macy’s, with some square footage ready to be occupied.

Sources say Apple is negotiating for roughly 200,000 square feet of this space in the middle of the building, which holds down the entire eastern blockfront along Seventh Avenue between West 31st and 32nd streets, cater-corner to Madison Square Garden.

Apple may eventually need more space, advised a source familiar with the tech company’s needs. “But it solves a current problem,” this person said, explaining that the iPhone maker is bursting out of its local digs at 100-104 Fifth Ave. in the Flatiron District, where it has just over 52,000 square feet for its marketing division and commercial software applications unit.

Apple could also help Macy’s get out of part of its lease as the department store moves its offices to Long Island City, sources said.

Vornado has two choices. It can approve the sublease and leave Macy’s on the lease — or take on Apple’s creditworthiness, sign a direct lease with Apple, and drop Macy’s from the rent obligation that would only occur if Apple defaulted.

Taidgh Barron/NY Post

Real estate executives who are not involved in the talks but familiar with the companies say Vornado will likely want to deal directly with Apple.

Either way, spies say the deal would be in the mid-$60s per square foot, a bargain over new towers where rents start at $100 per square foot and up.

A CBRE team of Scott Gottlieb, Liz Lash and Ross Zimbalist is handling Macy’s sublease, which runs through April 30, 2035.

The 1923-era building Apple is targeting was recently rebranded by Vornado as Penn 11. The former Equitable Life Assurance Building was designed by Starrett & Van Vleck. It has a distinctive high-arched entryway that leads into an ornate vaulted lobby that was restored in 1993.

The floors stretch from over 60,000 square feet at the base to over 50,000 square feet in the middle. The top floors, leased by AMC, are set back like a wedding cake and floors are smaller. As a c-shaped building, it has five sides of windows with ceilings ranging from 14 to 16 feet high, says the marketing brochure.

At the nearby Farley Building, Vornado’s renovation of the building housing the post office at 390 Ninth Ave., Apple wanted to only lease a few hundred thousand feet while Facebook agreed to take all 740,000 square feet. That lease is still under negotiation.

The companies involved naturally declined comment or did not return requests for comment.