- Gusto is doubling its Penn 1 footprint to 76K SF with a new 38K SF lease and renewal of its existing space.
- The expansion runs 13 years on the 47th floor, while the 52nd-floor renewal extends for five years.
- Penn District availability fell to 6.7%, the tightest in Manhattan, as Midtown leasing demand absorbed space.
Gusto is doubling its office footprint at Vornado Realty Trust’s Penn 1 to 76K SF. The Real Deal said in its report on the Midtown expansion that the HR technology company signed a new 38K SF lease.
The new space is on the building’s 47th floor. Gusto also renewed its existing 38K SF space on the 52nd floor. Together, the two spaces bring the company’s total Penn 1 footprint to 76K SF.
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Penn 1 Office Lease Adds 38K SF
The new 38K SF expansion lease runs for 13 years. Gusto’s existing 38K SF lease received a five-year renewal. Asking rent on the transaction was $135 PSF.
CBRE’s Jeff Fisher, Sacha Zarba, and Connor Krup represented Gusto. Vornado’s Josh Glick, Jared Silverman, and Anthony Cugini handled the landlord side in-house. Vornado and Gusto declined to comment.
Gusto is based in San Francisco and provides payroll, benefits, hiring, and other human resources services. Other Penn 1 tenants include Samsung, Dell, Empire Health, Hartford Insurance, Jacobs Engineering, Morgan Stanley, and Wells Fargo.
Penn 1 Upgrades Support Leasing
Penn 1 totals 2.5M SF and is the largest office building in Vornado’s Penn District. The landlord completed a $450M renovation covering several major parts of the property. Improvements included new plazas, a curtain wall, elevators, and lobbies.
The renovation also included LEED certification and other sustainability upgrades. Carbon-cutting improvements formed another part of the building’s broader modernization program.
Vornado also added 160K SF of food and recreational amenities at the building’s base. Gusto’s expansion aligns with strong Class A office demand across Midtown.
Penn District Tightens
The Penn District and nearby Hudson Yards ranked as Midtown’s third most-active leasing district during the second quarter. CBRE measured 609K SF of leasing volume across the area.
The district also led Midtown in absorption as demand reduced available inventory. Availability fell to 6.7%, according to CBRE. That was the lowest availability level in Manhattan.
The leasing and absorption figures point to tightening conditions around Penn Station. Gusto is adding space within that environment rather than consolidating its existing footprint.
Why It Matters
Gusto’s decision combines a long-term expansion with a shorter renewal at a recently upgraded Class A tower. The transaction adds 38K SF of new occupancy while preserving the company’s existing 38K SF space.
That brings Gusto’s total footprint at Penn 1 to 76K SF. The expansion also follows Vornado’s $450M renovation of the 2.5M SF building.
The deal comes as the surrounding district records strong leasing and absorption. Availability has fallen to 6.7%, giving the Penn District the lowest level in Manhattan.
