MIDTOWN — A new incubator in the Facebook’s former-New York headquarters celebrated its grand opening on Tuesday, pledging to help the city give Silicon Valley a run for its money as a center for technological innovation.
The Hub@GCT, which occupies the fourth floor of 335 Madison Ave. and overlooks Grand Central Terminal, promises to offer discounted, short-term leases to growing startups in an effort to get around the real estate constraints that make growth difficult for companies in Manhattan, according to its founders.
"For companies with 10 to 100 employees, it's really difficult to find space, because you're poised for growth, and so a long-term lease is really dangerous to take on, but you need secluded space to start" said co-founder Matthew Harrigan. "The Hub was built specifically to handle companies like that."
Harrigan, who along with Charles Bonello co-founded The Hub’s parent company Grand Central Tech, said the goal of The Hub is to take the model of successful Silicon Valley-style incubators and fit it to New York to help companies develop technologies that work in New York, for New Yorkers.
“The Hyperloop [high-speed train] sounds amazing, but how amazing is it if it only drops us off in Newark?” he said at he hub's grand opening, to resounding chuckles. “For major innovations to be unlocked, the city itself — it’s infrastructure, its laws, its policies — is going to have to be considered.”
The new space, which coils around an open-air center overlooking the building lobby and is divvied up into a number of different offices, conference rooms, and open co-working spaces, is the city's largest urban tech space, according to its founders.
Facebook left the same space on the fourth floor in 2014, moving to a Frank Gehry-designed office on two floors of 770 Broadway at East Eighth Street in Greenwich Village, according to news reports at the time.
The Hub was spearheaded by Grand Central Tech, which Harrigan and Bonello founded in 2014, and the company worked closely with the city and the building owner, Milstein Properties, to develop the space. Milstein contributed $5 million to the construction of the space, with the New York City Economic Development Corporation pitching in another $2.5 million.
“The biggest opportunity is to not only interact with other companies but also with the city government and the corporate world around them,” Bonello said.
Grand Central Tech is hoping to attract mid-size startups looking to grow. Leases at The Hub will be more flexible, the founders said, giving tenants the chance to sign on for as short as six months with the option to expand if money starts flowing and hiring gets going.
The cost of renting space at The Hub depends on the size of the company, starting at $490 per person per month. At capacity the space would ideally hold about 30 companies of varying size, Bonello said.
The Hub already has a handful of tenants, including iobeam, a company that monitors hardware for cities and BlocPower, a company that engineers and finances clean-energy projects in underserved communities.
At a ribbon-cutting ceremony on Tuesday, Deputy Mayor Alicia Glen welcomed the push by The Hub to bring tech companies and investors to New York.
“There is no city in the world better positioned to be the capital of technology and innovation than New York City,” she said.