Twitter to scale back NYC office space as Elon Musk cuts costs

A person walks past the Twitter offices in New York City on January 12, 2023. Photographer: Angela Weiss/AFP/Getty Images

Twitter Inc. is seeking to sublease New York office space as the technology company looks to curb costs.

Twitter recently listed nearly 200,000 square feet (19,000 square meters) of space for sublease at 245 and 249 W. 17th St. in Manhattan, according to data from real estate brokerage Savills.

An email seeking comment from Twitter wasn’t returned immediately; the company previously laid off its entire public relations department. A spokesperson for Pacific Investment Management Co.’s Columbia Property Trust, the owner of the building, declined to comment.

Elon Musk has been slashing costs since taking over Twitter last year. The company has slashed jobs and been accused of missing rent payments on offices in San Francisco and London. Subleasing the New York space could help Twitter reduce costs, given most property contracts require tenants to pay rent for the life of a lease even if the space isn’t occupied.

The 17th Street buildings were among a handful of properties tied up in a recent default by Pimco’s Columbia Property Trust. The office owner said last week that it was working on a restructuring of the loans with its lenders.

Twitter’s office pullback is the latest real estate retrenchment from a major technology firm. Facebook parent Meta Platforms Inc. has given up some offices at Manhattan’s Hudson Yards, while Amazon.com Inc. also cut back on a planned expansion in the city, Bloomberg reported last year.

That’s adding to the woes of many landlords in the city, who relied on large technology firms in recent years as a driver of leasing. While financial services companies have stepped up to take more space, nearly 19% of offices in the city were available to rent as of the fourth quarter, according to Savills.