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December 29, 2004

Internet incubators, circa 2004

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Posted by Dominic Basulto

According to the New York Times, Internet start-ups looking for cheap, flexible real estate space in NYC might consider the turnkey solutions of Sunshine Realty Management, which operates two sites in Manhattan: 45 West 21st Street and 419 Lafayette. Basically, the company leases entire floors of buildings, divides up the space into cubicles and conference rooms and then offers it at affordable monthly rates to budding entrepreneurs. By New York standards, the prices are dirt-cheap: as low as $295 a month for a basic cubicle. But there's a lot of perks included -- the opportunity to have your mail sent to a real corporate address, the use of on-site conference rooms, and the ability to participate in group health care plans.

The New York Times doesn't actually use the word "Internet incubator" (that would be, like, so 1999) -- mostly because the real estate management company doesn't actually take an equity stake in the companies. In fact, it sounds like many of the entrepreneurs aren't even classic tech executives -- they are astrologers or travel agents or furniture designers. The two loft-like floors at 419 Lafayette, though, were formerly used by Internet consulting firm Razorfish.

Most interestingly, it seems that many of the new tenants are interested as much in the "proximity to others" as the low, low prices. In fact, one stay-at-home office worker interviewed for the piece emphasized that, "I need to get out. That was my main draw..." For the Wi-Fi and Lattes generation, there is obviously a trade-off between between working in public, open spaces that lack certain amenities (private meeting rooms) and working in stuffy, closed offices.

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