USA Today Owner Gannett Moves HQ from VA to the Theater District

The original Gannett which was headquartered in Virginia, was taken over in 2019 by New Media Investments an investment firm that already owned Gatehouse Media for $1.2 billion. Since Gannett already has office space in mid-town Manhattan, so it is not expected to have any immediate impact on the local real estate office market.

| 10 Mar 2024 | 06:10

Gannett, the nation’s largest newspaper publisher which owns USA Today and more than 250 local newspapers from Phoenix to Rochester, is packing up its corporate headquarters in Tysons, Virginia and moving it to New York City.

That will put the newspaper giant in close proximity to some of its publications in the New York metro area including The (Bergen) Record and Asbury Park Press in New Jersey and the Journal News, which covers Westchester, Rockland, Putnam, and the Lower Hudson Valley.

The move won’t have much impact on local commercial real estate in the Manhattan since Gannett already has large mid-town Manhattan office which will now inherit the HQ title.

The abandonment of the Tysons location is part of a broader shedding of office space since the early 2010s as advertising and circulation rates have declined. Some observers saw the writing on the wall when Tamares Group, a London-based company, purchased the two-building, $270 million complex at Tysons from Gannett.

The original Gannett was taken over for $1.2 billion in November 2019 by New Media Investment Co which already owned Gate House Media which published newspapers in small and mid-sized markets. The combined company, which had over 24,000 employees at the time of the merger, kept the more well known Gannett moniker for the new company.

It undertook deep cuts to staff that prompted some of the papers that were represented by the News Guild union to stage a walkout in June 2023. Jon Schleuss, the president of the NewsGuild, at the time of the walkout said that the company had eliminated 54 percent of the combined workforce of Gannett Co. since its merger with GateHouse Media in 2019.

Its cutbacks on personnel have also meant a shrinking of its physical facilities.

A filing with the Securities and Exchange Commission (SEC), first reported by FFX Now, stated that Gannett plans to seek subleases for the 176,000 square feet it still retains for use at the Tysons offices (7950 Jones Branch Drive) until October 2030, when their lease expires. The total area of office spaces reaches 822,000 square feet. “Effective March 31, 2024,” the filing continues, “our new corporate headquarters will be located in New York, New York, which occupies approximately 24,000 square feet, under a lease agreement terminating in May 2031.” The New York offices, located on 1675 Broadway, was first subleased to Gannett in 2021.

The SEC report refers to Gannett headquarters as being located in McLean, Virginia, which is right next door to Tysons. The street address of the headquarters, however, is located within Tysons.

As Gannett moves out, other companies are moving in to the Virgina office tower. Software company Appian took 200,000 square feet in 2018, and identity verification tech company Pangiam followed them in 2022 with a slightly smaller footprint of 20,000 square feet.

Even if Gannett is getting rid of the Tysons offices, the employees who work there will keep their jobs. Gannett told Straus News that journalists and other staff from USA Today’s Tysons newsroom will continue working remotely or from the D.C. bureau office. “We’re embracing our flexible working model by investing more in our people and technology, rather than real estate,” a spokesperson said. “We remain firmly committed to the sustainable future of journalism as we adapt to a progressively digital world.”

The new Gannett headquarters in New York encompasses the entire 23rd floor of a 35-story tower, with Gannett paying rent in the mid $60s per square foot to its sub-landlord, Publicis Groupe. This is considerably less than the average asking rent in directly available Midtown office space in the fourth quarter of 2020, which was $82.29 a foot. Gannett’s reduced rent appears to be a continuation of a trend that Commercial Observer first reported in late 2020, when the COVID-19 pandemic caused a glut in subleasing that subsequently dragged down rents for companies seeking office space.