Barker DZP CEO John Barker gets excited when he talks about his agency’s new offices in downtown New York. His advertising agency moved into a penthouse on Broad Street last September, and recently put on the finishing touches.
“I had somebody in my office who’s been in the advertising industry for literally 50 years. And he said this is the best view he’s seen from any agency in his lifetime,” Barker said.
He thinks that the Financial District is going to be associated with the ad culture of Madison Avenue very soon.
While New York’s Financial District is still home to giants like Goldman Sachs, Deutsche Bank, and American Express, it has been making plenty of room for the creative services industry.
The neighbourhood offers ad agencies cost-effective space to create the large, interesting offices advertising creatives desire.
Since 2005, 18 ad agencies have moved downtown. Consolidating financial companies have left millions of square feet of office space in recent years, and the public and private sector have worked in unison to attract creative and media companies to take their place.
“I really believe that advertising is a terrific barometer of the next hot neighbourhood,” Barker said. Ad agencies want hip offices in hip places because, as Barker said, their clients rely on them to be monitoring the pulse of what is trending in culture.
And in addition to impressing corporate marketers, he said that spacious and interesting offices are necessary for creating a creative culture that drives the industry.
Because his agency’s 10-year lease on its SoHo offices was running out at the end of last year, Barker looked for new office space last year in Chelsea, the Flatiron district, and even Brooklyn. But he said that after checking out the benefits of the Financial District, he immediately knew it was the best choice.
Barker said his feeling that the Financial District was the new place to be was confirmed when he competed with the hot agency Droga5 for space.
Droga 5 ended up choosing a location on Wall Street, where it will move sometime early this year from its current NoHo location.
Sarah Thompson, CEO of Droga5, echoed some of Barker’s sentiments regarding the move.
“As a company reliant on the ideas generated by our people, Wall Street proved the best location for those ideas to thrive. Being on the waterfront offers a unique perspective, and sharing the neighbourhood with the business engines that drive the world will fuel our creativity and drive,” Thompson wrote in an email.
Earlier this month, the ad agency Mekanism signed a deal for two floors of a building on Broad Street. Its CEO Jason Harris focused on some practical benefits of the move.
“The Financial District is absolutely the next up and coming place to be for creative companies. This is based on a few factors: the amount of unique spaces with character, convenience to subways, and some great city incentives. But Mekanism is there primarily for a kick-arse roof deck,” Harris wrote.
The city incentives he referred to include attractive tax breaks. New York governor Andrew Cuomo has a primary initiative to move tech, media, and advertising companies to his state, and the Financial District is its epicentre.
And the space is notably more affordable than elsewhere in the city. The Commercial Observer reported, for instance, that the upper floors of Mekanism’s new building go for somewhere around $US40 per square foot, at a discount from real estate in Midtown and Midtown South.
Stephanie Jennings, vp-economic development of the Alliance for Downtown New York, said that the business improvement district (BID) her agency maintains has seen the Financial District’s transformation happening over time.
“The momentum of the past 10 years is coming to fruition now and in the next two years,” Jennings said. “The diversity of tenants and businesses is rapidly changing.”
Ad agencies, she explained, can get a prestigious address easily accessible to young, talented workers at an affordable price. And lower Manhattan is rapidly expanding. Projects like the new subway hub the Fulton Center, the new World Trade Center offices, and big retail projects are all scheduled to be completed by 2016.
“They’ll have a dramatic impact on rents,” Jennings said. “Mekanism, BarkerDZP, and others are smart to get in now.”
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