Spotify is committing to New York City as its U.S. headquarters, announcing on Wednesday that it will move to 4 World Trade Center in lower Manhattan and bring with it over a “thousand new employees” to the Empire State. Governor Andrew Cuomo said in a press conference that 832 current jobs will also be saved by Spotify’s decision to stay in the city, where it is currently based in the Chelsea neighborhood.
The Swedish music streaming service will be leasing 400,000 square feet in the tower, whose tenants have included Hudson River Trading, Zurich, PadillaCRT, Syntactx, Dixon Hughes Goodman LLP and Silver Suites Offices. The decision by Spotify “adds a growing dimension to downtown,” said Cuomo. He added, “We are now prepared to compete. They could’ve gone anywhere… a very hot and cool company. I was on Spotify as a member before any of this by the way.”
Spotify’s general counsel, Horacio Gutierrez, said the company “did consider a number of options” from other states, but ultimately decided to stay — and more than double its work force — in NYC. “We will bring more diversity and a whole lot of music to the area,” he said, telling reporters that the jobs will be in fields like engineering, marketing and all other areas of the service. “I hope that Spotify’s expansion send a message to the tech community that NYC is open for business.”
Spotify will receive rent reduction incentives amounting to $11 million over the course of a decade, according to Howard Zemski of the Empire State Development Corporation, who was also on hand and had a fun time ribbing Cuomo on his pop-centric song choices for a Spotify playlist that was revealed and which included: Jay-Z and Alicia Keys‘ “Empire State of Mind,” “Grenade” by Bruno Mars, Tom Waits‘ “Downtown Train,” Tony Bennett and Lady Gaga‘s version of “Cheek to Cheek” and, perhaps predictably, no less than four Billy Joel songs including “New York State of Mind” among others.
The news has been met with praise by Downtown Alliance, one of the city’s largest business improvement district organizations.
“Today’s Spotify announcement is music to our ears. It ups the cool factor in Lower Manhattan and boosts the neighborhood’s cultural cred,” said Jessica Lappin, the group’s president. “It’s also big news as it means leasing at 4 WTC is now complete. Along with the concentration of media firms already here, and the forthcoming Performing Arts Center, Spotify’s move is going to jump-start the growth of a vibrant local entertainment scene in Lower Manhattan.”
In 2015, the last year for which revenues numbers were available, Spotify lost $200 million on $2.2 billion in revenue. But with a current valuation of $8 billion and studies showing the streaming service is accruing subscribers faster than Apple, to the point that it now accounts for 43 percent of paid subscribers worldwide (according to research firm MIDiA), the company may be on the path to profitability which will help it in its quest for an IPO, reportedly due to happen either this year or in 2018.
“New York city is our home in the U.S.,” a Spotify spokesperson tells Billboard, “and we’re happy to be building out the team here at 4 World Trade.”