PRH to save $20m from NYC office move

PRH to save $20m from NYC office move

Penguin Random House (PRH) is bringing all its New York City-based employees under one roof, in Manhattan, to make annual savings of $20m (£15.4m).

PRH US announced yesterday (8th August) it will join 375 and 345 Hudson Street with colleagues at 1745 Broadway in early 2019, after the landlord of the premises presented "an unanticipated, one-time opportunity" to PRH to accommodate all its NYC- based employees at its midtown location at "a greatly reduced long-term rent".

While acknowledging the "many cultural and operational benefits" of the arrangement, the publisher said in the past the "daunting" fiscal challenges involved in uniting employees in one location had meant it was not previously "in the works" to do so. 

Other benefits of the move included enhancing collaboration and cutting down on the "constant Broadway-Hudson commute", and being the sole occupant of a building, the company said.

The organisational structure of PRH North America will not change in any way as a result, chief executive officer Markus Dohle confirmed, and negotiations are currently being finalised.

A cross-divisional team from corporate and publishing groups will develop and oversee the project, with assurances from Dohle, "as with the current lower floors at 1745, our new space in the upper floors will reflect this structure and be designed in a traditional combination of offices and workstations grouped by publishing division, to accommodate everyone".

Dohle said: "The resulting fiscal savings would be significant: approximately $20 million annually. In an ever-changing publishing marketplace, leveraging the opportunities we have together as Penguin Random House for meaningful reductions in costs will make us more robust for the future and better able to invest in our authors and their books."

He added: "Another advantage of the move is that unifying the workplaces of our uptown and downtown colleagues from the corporate divisions will enhance collaboration, as we eliminate that constant Broadway-Hudson commute. Whereas at Hudson Street we are one of many tenants, I am especially pleased that this will not be so at 1745. Penguin Random House essentially will be the sole occupant, with building services completely focused on providing support for us and our visitors."

PRH US said it wanted to share news of the decision "immediately" and that it is "committed to transparency throughout the process".

The news follows PRH UK's announcement in June that it is vacating both its London Transworld office in Ealing and its office in the Strand by 2020 to relocate staff to the existing site in Vauxhall Bridge Road and another, as yet to be identified building, "ideally" within walking distance. Staff were told the accompanying renovation of the existing office on Vauxhall Bridge Road would be their chance to create their own “workplace of the future”.