Bankrupt MediaMath Looks To Reject 100K SF World Trade Center Lease
Advertising tech firm MediaMath is shutting down, potentially leaving a nearly 100K SF hole in Lower Manhattan’s office market.
The advertising technology firm filed for Chapter 11 bankruptcy protection last week after its attempts to woo a buyer or investor failed, The Wall Street Journal first reported.
MediaMath signed a 106K SF, 15-year lease in 2014 with developer Silverstein Properties to anchor 4 World Trade Center. It owes Silverstein $2.5M in rent payments, according to its bankruptcy filing. As part of the proceedings, MediaMath asked a Delaware bankruptcy judge to reject the lease.
The company wrote in its request that it no longer occupies its office in the building and that Clear Street Management, a financial brokerage, has a sublease on part of the space. Clear Street lists the 45th floor in the 72-story, 2.5M SF skyscraper as its headquarters on its website.
Clear Street subleases a full 44K SF floor in the building, according to a Silverstein Properties spokesperson, who added that the landlord plans to enter into a direct lease with Clear Street if the bankruptcy court agrees to the lease rejection.
Silverstein plans to find a new tenant to occupy the remaining square footage left empty by MediaMath. The 978-foot-tall trophy tower has few vacancies at present, with 19K SF on the 47th floor and 43K SF on the 28th floor, per its website.
Silverstein’s 4 World Trade Center opened in 2013, signing MediaMath as one of its first private sector tenants. MediaMath planned at the time to bring its 300 New York-based employees to the building. By 2021, the firm had raised more than $500M in venture capital.
But it burned through that cash and couldn't secure a buyer to continue funding operations. In a message shared with partners last week, MediaMath CEO Neil Nguyen wrote that a deal to save the firm collapsed, dooming it for good.
"Despite our best efforts, the deal we expected to be consummated this week fell through yesterday," Nguyen wrote, AdExchanger reported. "We are left with the inability to continue operating the Company in a normal course of business. Accordingly, we are required to wind down our business immediately. Today will be most employees last day."
4 World Trade reached 100% occupancy before the pandemic with deals including a 378K SF lease with Spotify that expanded to 564K SF in 2018.
But like other office properties, it has since seen a decline in occupancy as tech companies seek sublease arrangements due to hybrid work arrangements, shrinking staffs and tightening budgets as venture capital funding as receded.
Spotify announced in May that it was seeking to sublease roughly 86K SF in the building, Bloomberg reported. Private equity giant KKR signaled it plans to leave its space in the building as part of a consolidation in Hudson Yards, and fintech firm Hudson River Trading departed for a larger space at 3 World Trade Center.
