CBRE Group’s Industrious has signed its newest location in Manhattan, Industrious Lex & E 50th St. Starting this fall, the flex office provider will occupy the entire second floor, spanning 20,000 square feet, at 560 Lexington Ave. in Midtown East. Cushman & Wakefield negotiated on behalf of the tenant, while landlord Rudin had in-house representation.

The new space will have 158 seats available for solo entrepreneurs, growing teams and established businesses. The amenity suite comes with a new café, lounge, conferencing area and outdoor space, currently created by Rudin within the tower.

The Lexington location will join Industrious’ other New York City spaces: Tower 49, at 12 E. 49th St.; Midtown on 50th St, at 135 W. 50th St.; Carnegie Hall, at 152 W. 57th St.; 1411 Broadway; Bryant Park off Fifth, at 25 W. 39th St.; 261 Madison; and Penn 1, at 250 W. 34th St.

Cushman & Wakefield’s Justin Halpern, Ed Wartels and Ben Bouganim assisted Industrious. Kevin Daly of Rudin represented building ownership.

A Midtown Manhattan office building

Built in 1980 and cosmetically renovated in 2015, the office building at 560 Lexington Ave. features floorplates averaging 17,204 square feet and 3,500 square feet of retail space, according to CommercialEdge information. The 22-story high-rise is easily accessible to public transit and Grand Central.

The tower is LEED Silver-certified and gold-certified by WiredScore, featuring a building operation system that optimizes it through AI to reduce emissions. The Class A property recently underwent a modernization program that involved creating a new lobby, adding new elevator cabs and constructing an on-site, glass-enclosed subway entrance for the nearby train station.

State of the NYC coworking market

CommercialEdge listed Manhattan as the top coworking market in the U.S. for total square footage as of February. Chicago and Los Angeles were the other two metros on the podium.

Michael T. Cohen, a principal with Williams Equities, which owns and operates approximately 3.5 million square feet of NYC office space, told Commercial Property Executive, “Coworking is back. Once again, it is part of the mix of tenants expanding into and absorbing office space in Manhattan.”

He added that the epoch of coworking firms “signing a market-rate lease and absorbing the lion’s share of the risk is gone for good.” Similarly, few New York City building owners have been willing to accept the so-called “management deals” under which they enjoy the “upsides and downsides.”

As such, the sophisticated coworking operators have developed new leasing models that involve sharing their profits and losses with the landlord, Cohen mentioned.

READ ALSO: Where’s the Coworking Sector Headed?

“WeWork appears to be making a comeback by leveraging its occupier relationships and taking space where it has a pre-existing commitment to fill. On the other hand, Industrious is exploiting the demand for office suite occupiers and landlords looking to add an amenity to their building and diversify their product mix.”

Cohen said IWG and others are all scouting suitable locations across the city.

“You can expect many coworking lease announcements as the year progresses,” he added.

Adapting to businesses’ needs

Flex space providers’ ability to adapt to businesses’ evolving needs and deliver high-quality office and conference spaces has made them a valued partner for local banks, hedge funds and companies “that simply don’t have enough space for all of their employees,” said Jeff Gural, chairman of GFP Real Estate.

Lee Brodsky, CEO of BEB Capital, told CPE, “While many coworking operators have come and gone, flexible office space has remained essential,” underscoring that today’s hybrid and remote workers “seek spaces that foster community, productivity and connection—beyond a home office or coffee shop.”

Recognizing this demand, BEB Capital launched BEB Work at 26 Harbor Park Drive in Long Island, creating a coworking space designed for professionals to work alongside like-minded individuals in the community.

“Since our February launch, we’ve seen strong demand for private offices and expect momentum to continue growing in the months ahead,” Brodsky concluded.

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At the end of 2024, the biggest office metro in the country continued to struggle with new supply, while investment activity picked up pace since 2023, according to CommercialEdge data. Manhattan transaction trends are similar to the sector’s performance on a national level.

Considering the evolution of return-to-office policies, rising maturing debt and high construction costs, the metro showed mixed signals. The borough’s total sales volume for 2024 was the largest in the country and marked a 76 percent year-over-year increase. However, with the increase in discount deals, the average sale price per square foot dipped to $363.62 per square foot.

Manhattan office sales prices dip

In 2024, 11.3 million square feet of office space across 47 properties changed ownership in Manhattan, adding up to a total volume of $4.1 billion. Last year’s investment volume marked a 76 percent jump, compared to 2023’s total. Among gateway markets, Manhattan kept its leading position, followed by Washington, D.C., with $3 billion in deals, and Los Angeles, with $2.1 billion.

Investor appetite in the borough increased consistently throughout last year—from the $99.2 million recorded at the end of the first quarter, to the fourth quarter’s $1.4 billion. One of Manhattan’s biggest transactions last year was Bloomberg Philanthropies’ $560 million acquisition of 980 Madison Ave. The company picked up the 118,635-square-foot asset in June after the seller, RFR Realty, defaulted on a $197.6 million loan.

Office assets in the metro traded at an average sale price of $363.62 per square foot—significantly above the national average of $171.61 per square foot, but much lower than in 2023. Manhattan registered the second-highest prices among gateway cities, with Miami emerging as the most expensive metro in the U.S., at $395.24 per square foot. San Francisco came in third, with $345.22 per square foot.

Since the start of 2025, eight properties amounting to approximately 3 million square feet traded in the metro. The sales volume added up to $1.4 billion, at an average of $462.05 per square foot. The biggest transaction so far this year was Haddad Brands’ $357 million acquisition of Two Park Avenue in NoMad. Morgan Stanley sold the 1.1 million-square-foot high-rise.

A steady pipeline with large projects

As of December, Manhattan’s under-construction pipeline included 2.7 million square feet of competitive space, representing 0.6 percent of existing stock—lower than the national average of 0.8 percent. Among gateway markets, Boston led with 3.4 percent, followed by San Francisco’s 2.3 percent.

In terms of underway stock, Manhattan placed sixth in the nation. Across similar markets, Boston led the rankings with 8.7 million square feet, followed by San Francisco (3.8 million square feet) and Dallas (2.9 million square feet), while the borough outperformed Los Angeles and Miami, with 1.9 million square feet ad 1.8 million square feet, respectively.

The list of significant office projects underway remained unchanged since our last update. The largest project under construction is the upcoming global headquarters of JPMorgan Chase, at 270 Park Ave. in the Plaza District. The company broke ground on the 2.5 million-square-foot, Class A+ office tower in 2020, with estimated completion by the end of August 2025.

Construction starts crash

At the end of 2024, developers delivered 1.4 million square feet across four properties in Manhattan, representing 0.3 percent of existing stock and reflecting a 75.7 percent year-over-year drop. Among gateway markets, Boston topped the charts with 6.7 million square feet completed, marking a 27.3 percent annual increase, while most similar markets registered notable declines, including Washington, D.C.’s 50 percent dip.

Notably, The Walt Disney Co.’s New York new headquarters dubbed 7 Hudson Square, came online last year. Totaling 1.3 million square feet, this property was completed in August 2024, with Silverstein Properties as developer.

Meanwhile, only two projects broke ground in the borough, comprising 356,000 square feet and marking a massive 594 percent year-over-year decline. When adding projects in planning stages to the relative-to-total-stock pipeline, the figure reached 3 percent—just north of to the national average of 2.9 percent and on par with Los Angeles.

Manhattan rents decreased in 2024

As of December, Manhattan’s office vacancy rate stood at 16.6 percent—below the national figure of 19.8 percent and up 20 basis points year-over-year. The borough’s rate was lower than in Boston (17 percent) and Washington, D.C. (18.5 percent). Miami posted the lowest office vacancy in the nation at 15.2 percent, while San Francisco’s 28.8 percent was on the other side of the spectrum.

Since our previous update, Manhattan fell from its leading position as the priciest metro for office leasing. As of December, asking rents averaged $68.42 per square foot—still more than double the national average of $33.11 per square foot. San Francisco’s $70.56 per square foot took the lead.

One of the largest leases of 2024 was Bloomberg’s 924,876-square-foot renewal and expansion at 919 Third Ave.

Office-to-residential policies in NYC

According to CBiz, the value of office spaces in New York City dropped by 40 percent since the pandemic, while one in five buildings vacant.

In early December 2024, the City Council adopted the City of Yes Housing Opportunity, enabling owners with underutilized office assets built between 1961 and 1991 to convert them to residential buildings with multiple types of housing, according to the city’s website.

Introduced in 2023, the Office Conversion Accelerator Program is another option, assisting landlords in conversion projects designed to generate a minimum of 50 residential units. Additionally, the state also launched two new exemption programs for the 2025 fiscal year, offering tax incentives to developers that propose conversions with at least 25 percent in affordable housing units.

CommercialEdge’s Conversion Feasibility Index, a tool launched earlier last year, helps evaluate a building’s potential for residential repurposing. At the start of this year, Manhattan had 907 buildings with a CFI score between 90 and 100, placing them in the Tier I category.

In June last year, Sunlight Development purchased an office building at 95 Madison Ave., also known as the Emmett Building, with plans to convert it into a 70-unit residential building. The developer paid $65 million for the 141,161-square-foot, Class B office asset, and secured a $20 million loan held by Bank Hapoalim. This 16-story, historic building holds a CFI score of 93, CommercialEdge shows.

Coworking constantly improves

The coworking sector expanded in Manhattan through 2024, its 285 locations totaling 11.6 million square feet remaining the largest inventory in the country. The borough's flex office supply saw a notable increase from the 9.5 million square feet recorded at the end of 2023.

Other markets with large coworking inventories included Chicago (7.1 million square feet), Los Angeles (6.5 million square feet) and Dallas (5.2 million square feet). Manhattan’s share of flex space as percentage of total leasable office space stood at 2.3 percent—above the national figure of 2 percent. Among gateway markets, Miami led the ranking with a 3.8 percent figure.

At the end of last year, WeWork remained the flex office provider with the largest footprint in Manhattan, with operations totaling 2.6 million square feet across 29 locations. Industrious (1.5 million square feet), Regus (697,950 square feet), Convene (603,800 square feet) and Spaces (567,000 square feet) also maintained a strong presences in the borough.

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Two tenants have signed leases at 55 Broadway in Lower Manhattan, totaling more than 21,500 square feet. CBRE represented landlord Harbor Group International in both transactions.

Inclusiv, a network of community development credit unions, has signed a 10,986-square-foot lease and will occupy the entire 29th floor. The tenant currently has office space at 39 Broadway, Commercial Observer reported. Avison Young Principal Tom Kaufman worked on behalf of Inclusiv in the transaction.

CSA Group NY Architects and Engineers also renewed its 10,557-square-foot office space on the property’s 14th floor for an additional 10 years. This deal was brokered directly.

READ ALSO: What’s Defining Office in 2025?

The property’s tenant roster includes RAL Cos., Syscom Global Solutions Inc. and Bond Collective, among others, CommercialEdge shows. The high-rise is currently 93 percent leased.

In 2024, renewals made up 68 percent of leases, marking a 10 percent increase from the previous year, a new CBRE report shows. Over half of the renewing tenants kept their existing space, while nearly a third expanded. Manhattan dominated the market, securing the largest share of the 100 top leases of last year.

A renovated tower in the Financial District

Located between Exchange Alley and Morris Street in the Financial District, the Class A 55 Broadway is near Interstate 478 and is less than one mile from World Trade Center. JFK International Airport is some 14 miles away.

The 358,000-square-foot building has been under the Harbor Group International ownership since 2014, when the company acquired the asset for $157.3 million from Broad Street Development, according to CommercialEdge. Later in 2017, Savanna and Paramount Group acquired a 45 percent ownership stake in the property. Last year, the office tower became subject to a $71.6 million loan, originated by AIG, the same source shows.

Completed in 1982, the 32-story high-rise underwent renovations in 2013. The building features floorplates ranging between 11,000 and 17,000 square feet, eight passenger elevators and 15,000 square feet of retail space.

The CBRE team representing the landlord included Executive Vice President Brad Gerla, Senior Vice President Jonathan Cope and Vice President Hayden Pascal.

The post Harbor Group Inks 2 Leases in Lower Manhattan appeared first on Commercial Property Executive.

Lincoln Equities Group has signed a 109,450-square-foot long-term lease at its Lincoln Logistics Rockland, an industrial facility in Valley Cottage, N.Y.

The tenant is National Ramp, a residential and commercial modular ramping provider, that increased its footprint in Rockland County and will use the space to form a new corporate headquarters. JLL’s Executive Managing Director James Panczykowski represented the ownership and facilitated this transaction.

Lincoln Logistics Rockland is a recently completed, Class A distribution center that includes 220,000 square feet. The property is close to White Plains, N.Y., a suburban hub north of New York City that ended last year among the top emerging industrial markets in the U.S. for its development activity and high property values.

Located at 625 Corporate Way, the facility is close to Interstate 287, as well as to Palisades Interstate Parkway. Additionally, the Port of Newark-Elizabeth and major airports such as John F. Kennedy International Airport and Newark Liberty International Airport are within a 45-mile radius of the property.

Lincoln Logistics Rockland features 36-foot clear heights, 34 dock doors, two drive-in doors, a built-to-suit office component, 123 vehicle parking spots and 41 trailer parking spots. The property can also include expansion options of up to 55 dock doors and 53 trailer parking spots. The remaining 110,550 square feet are available for lease.

Deals and projects of two longtime partners

Lincoln Equities Group delivered the building with capital partner PCCP LLC and with construction funds totaling $37.7 million, secured in the form of a bridge loan originated by Principal Financial Group, according to CommercialEdge.

Meanwhile, the duo has a 204,407-square-foot industrial project currently underway in the area. Situated 30 miles from Lincoln Logistics Rockland and known as Belleville Logistics, the two-building industrial project is rising at 681 Main St. in Belleville, N.J. The partnership landed a $53.5 million senior construction loan for the development in April last year.

Lincoln Equities Group and PCCP LLC partnered for the first time in 2021, when they purchased a three-building industrial portfolio in the same area. Just last month, the partners sold off the 261,950-square-foot asset in a $62.8 million deal.

The post Lincoln Equities Inks New York Industrial Lease appeared first on Commercial Property Executive.

The children’s apparel company, owned by Berkshire Hathaway, was already leasing the entire seventh floor at the 26-story tower. With this deal, it will also fully occupy the 31,663-square-foot sixth floor, bringing its total footprint at the property to 63,417 square feet, Commercial Observer reported.

The property is now 77 percent leased. Its anchor tenant Metropolitan Commercial Bank signed a renewal and expansion agreement back in December, bringing its total footprint to 81,979 square feet. Other notable tenants include The Ayers Group, Riveria Investment Group, New York Bankers Association, Windsor Properties, Flushing Bank and Keller Williams, CommercialEdge shows.

Global Holdings acquired the building in 1991 for $104.5 million from The Equitable Life Assurance Society of The United States, according to CommercialEdge data. The tower is currently subject to a $250 million loan held by Landesbank Baden-Wurttemberg Bank, the same source shows.

The JLL team included Vice Chairman Paul Glickman, Senior Vice President Diana Biasotti, Associate Vice President Kristen Morgan and Associate Harrison Potter.

An upcoming revamped high-rise

Originally designed by Emery Roth & Sons, the office tower dates to 1953 and underwent cosmetic renovations in 2005. The property features 12,000 square feet of first-floor retail space, a fitness center and 100 vehicle parking spots.

The owner is currently implementing a $30 million capital improvement program within the building, with renovations led by VOCON. Plans include an updated lobby, amenity center, the addition of a conference center, lounge, barber shop and salon, as well as golf simulator and bowling valley. Renovations are expected to reach completion during summer next year.

Situated within the borough’s Murray Hill neighborhood, 99 Park Ave. is close to Grand Central Terminal and to Bryant Park, while John F. Kennedy International Airport is 15 miles away.

Manhattan’s vacancy lowest among the Northeast

The national office vacancy rate reached 19.7 percent in January, up 180 basis points year-over-year, according to the latest CommercialEdge report. Every office market experienced jumps in vacancies, with five of the top 25 U.S. metros recording surges of more than 500 basis points.

Despite this, in the first month of 2025, the Northeastern markets kept their rates below the national average. Manhattan’s office real estate trends show that the metro registered the lowest vacancy rate in this region, with 16.6 percent as of January, marking only a 10-basis-point increase.

Notable leases in the borough signed since the start of the year include Newmark’s recent 15-year renewal and expansion at 125 Park Ave. The company increased its footprint to 184,239 square feet at the designated New York City landmark, owned by SL Green.

In January, that same landlord inked a 92,663-square-foot deal at another property. IBM expanded and renewed its presence at One Madison Ave., in a deal brokered by JLL.

The post Global Holdings Inks 63 KSF Extension at Manhattan Tower appeared first on Commercial Property Executive.

Historically, a visitations rate drop from December to January is standard. Excluding the month’s two holiday weeks featuring Martin Luther King Day and New Year’s Day, the January 2025 rate would have equaled December 2024’s average rate.

Weather also played a factor. New York City’s average daytime temperature was 34 degrees in January 2025, compared to 41 degrees in December and 39 in January 2024. In January 2025, New York City experienced 4.5 inches of snow, compared to 2.3 inches in January 2024.

READ ALSO: C-PACE in NYC: Will the Program Finally Take Off?

Visitation for Class A+ buildings averaged 80 percent, down from 86 percent the previous month but up from 78 percent in January 2024.

Class A/A- buildings averaged 63 percent during January, down from 70 percent during December and slightly above 62 percent in January 2024. Class B/C building visitation slid 4 percent month-over-month but was up 5 percent year-over-year.

Manhattan’s office utilization

According to Avison Young’s latest Office Busyness Index figures, Manhattan office utilization is 79.9 percent of pre-COVID levels. Across the U.S., office buildings are 66.9 percent as busy as in January 2019, ultimately showing that NYC is 13 percent ahead of national figures.

“In a world where hybrid work has become so prevalent, the weather has become a significant factor for office attendance,” Pierre Debbas, Esq., co-founder of Romer Debbas LLP, told Commercial Property Executive.

This winter has been significantly colder this year than last, along with an increase in snowfall which has definitely hurt office attendance, Debbas added.

“[NYC’s] congestion pricing likely also played a role in office attendance as post-pandemic there is an increase of the workforce who prefers to drive in than utilize public transportation, and congestion pricing is only an added burden to an already expensive commute to the city.”

Debbas said Class A continues to outpace the rest of the market, predominantly driven by return-to-office mandates that larger corporations are imposing and the allure of all of the amenities that these companies provide in comparison to smaller and mid-sized businesses, which predominantly rent in Class B buildings.

The hybrid model is here to stay

Despite the headline, comparing office visitations for the past month to a pre-pandemic baseline may not be intuitive, according to Michael Webb, partner at Farrell Fritz P.C.

“Remote, work-from-home and hybrid employment arrangements have fundamentally, and perhaps permanently, changed how many work and live,” he told CPE. “It is unlikely that in-office work during the post-pandemic era will ever rise to pre-pandemic levels.”

However, REBNY’s latest monthly analysis of office visitation data for Manhattan buildings indicates the more significant “flight-to-quality” trend the office sector has experienced post-pandemic and suggests that high-quality office assets in major markets are far from having hit rock bottom, he said. The flight-to-quality trend in office leasing is not necessarily new but is borne out by the Placer.ai data analyzed by REBNY.

As REBNY highlights, Class A+ buildings in Manhattan had an average visitation rate of 80 percent for January. The rate drops 17 percent for Class A/A- office buildings to 63 percent, and it drops yet again for Class B/C office buildings.

“The data highlights that companies continue to seek, use and occupy office space in high-quality buildings that offer modern amenities, proximity to retail, transit or areas of socio-cultural interest, as well as health, wellness and sustainability initiatives and packages,” Webb said. “The REBNY analysis highlights the growing disparity within the market between full-service, high-end spaces and lower-quality properties.”

Premium office buildings also attract top dollar financing as a result. Earlier this year, Ivanhoé Cambridge, the real estate group of CDPQ, refinanced its 42-story trophy office tower at 3 Bryant Park in Midtown Manhattan, to the tune of $1.1 billion. JLL’s Capital Markets group arranged the funding.

Strict mandates can hurt office dynamics

Earlier this year, Amazon, Disney, JP Morgan, Starbucks and X summoned workers back to the office full or part-time, Robert Martinek, director at EisnerAmper, shared.

“However, it has been reported that companies that have enacted strict return-to-office requirements have had to deal with losing talent, as some top performers have quit,” he told CPE.

Some feel strict mandates can hurt office dynamics and reduce employee satisfaction, Martinek added. Except for government employees, most companies have adopted a flexible work arrangement. Remote workers have been home since the pandemic and have gotten used to working from a home office.

Supporters indicate that ‘work from home’ helps with family duties, Martinek observed. Additionally, there is no evidence that work-from-home employees are less effective than their counterparts.

“Many companies are downsizing their space but not removing it completely. The ‘two to three days in the office’ works best for companies and employees. The hybrid model is here to stay!”

The post Manhattan Office Visits Drop appeared first on Commercial Property Executive.

Newmark has signed a 15-year renewal and lease expansion at 125 Park Ave. in Manhattan, growing its footprint at the building to 184,239 square feet. The tenant was represented in-house by Newmark’s Jason Perla, Brian Waterman, David Waterman and Matthew Schreiner. 

Newmark has been a constant presence at 125 Park since the mid-1990s, when it committed to 47,000 square feet, according to Crain’s New York. Over the years, the firm has expanded its footprint; in 2014, Newmark occupied more than 133,000 square feet at the 654,800-square-foot property, Bisnow reported.

The office tower is now more than 99 percent leased, according to landlord SL Green. The company is currently finalizing the design of a new lobby and restoration of the building’s entrance to its original design.

READ ALSO: Net Effective Office Costs Edge Up

SL Green has owned the property since 2010, when the company acquired it for $330 million from Shorenstein, which had bought it in 2004 for $225 million. Completed as the Pershing Square Building in 1923, the office tower is a designated New York City landmark for its “significant contribution to the variety and richness of Midtown East.”

Located across from Grand Central Terminal, the 26-story building features floorplates ranging from 9,556 to 26,256 square feet, as well as 17,000 square feet of retail. Tenants at the LEED Gold-certified property also include TD Bank, Pandora Music and Canon U.S.A., according to CommercialEdge information.

SL Green, Manhattan’s largest office landlord, held interests in 54 buildings totaling 30.6 million square feet at the end of 2024. So far in 2025, the REIT has signed office leases totaling 455,008 square feet, with a current pipeline of about 975,000 square feet. In one of this year’s deals, IBM expanded its footprint at One Madison Avenue.

Manhattan office market sees some strength

Office leasing has picked up recently in Manhattan, a market that had been hit fairly hard by pandemic and post-pandemic realities. In 2024, according to Newmark data, 38.1 million square feet were absorbed in the borough, up from 30 million square feet in 2023, and the most since before 2020.

New office space deliveries, which had spiked to 5.7 million square feet in 2023—the most since 2019’s total of 7.7 million square feet—shrank to practically nothing in 2024, Newmark noted. Only about 100,000 square feet came online last year in Manhattan.

The post Newmark Expands Manhattan HQ appeared first on Commercial Property Executive.

• 548 W. 22nd St., Manhattan

Sale Price: $50.5 million

California-based cybersecurity company Fortinet Inc. has purchased the 38,100-square-foot retail building in Chelsea from Atlas Capital Group. The buyer, which already had a New York City location, plans to use the four-story building as its office, The Real Deal reported. It is unclear if the current tenants will continue to lease space at 548 W. 22nd St., or if Fortinet Inc. will continue to operate from both New York City locations.

The property came online in 1920 and was last upgraded in 2021. It features 11,258 unused air rights and is currently occupied by NADA New York, Shah Garg Foundation and Santa’s Secret.

• 73 Wooster Street #COM, Manhattan

Sale Price: $25.4 million

The 8,920-square-foot retail unit of the multifamily building at 73 Wooster St. was acquired by Acadia Realty Trust from EPIC, a London-based owner and developer of commercial real estate. The asset previously changed hands in 2011, when EPIC paid $15 million to Vornado Realty Trust for it.

The five-story building is in SoHo and totals 37,443 square feet. It dates back to 1929 and was last updated in 2003. The retail condo is currently leased to Italian luxury brand Moschino.

• 2134 Coyle St., Brooklyn

Sale Price: $22.4 million

Westhab Inc. has purchased the 20,411-square-foot, two-building retail asset in Brooklyn’s Sheepshead Bay from Slate Property Group. The buyer, an affordable housing provider and developer, landed $124 million loan originated by Wilmington Trust, for the development of a residential project at the property.

In July 2024, Slate Property Group acquired the pair of buildings in a $24.4 million portfolio deal, with plans to construct a seven-story residential community with 175 units. The development site has already received approvals since 2022 for a residential project.

The buildings at 2134 and 2150 Coyle St., came online in 1956 and include 55,407 square feet of unused air rights.

• 2481 Creston Ave., Bronx

Sale Price: $7.1 million

Joey’z Shopping purchased the 14,662-square-foot retail building in the borough’s Fordham neighborhood from Abro Management Co. The buyer secured a $4.3 million acquisition loan from Interaudi Bank. The single-story building originally came online in 1955 and includes 15,931 square feet of additional air rights. Tenants here include Citibank and Dresses for Less Clothing.

• 82 Beaver St. #B, Manhattan

Sale Price: $5.5 million

A private buyer picked up the 7,092-square-foot retail component of a 15-story residential building from Red Pine Capital Partners. The buyer landed a $3.7 million loan from SMS Financial through an amended and restated note. The commercial unit is within 1 Wall St. Court, also known as the Beaver Building or Cocoa Exchange. Designed by Clinton and Russell, the property was completed in 1904 as an office building and later converted into a condominiums in 2006.

—Posted on February 26, 2025

The post Top 5 NYC Retail Building Sales—January 2025 appeared first on Commercial Property Executive.

• 2 Park Ave., Manhattan

Sale Price: $357 million

Morgan Stanley sold the 852,731-square-foot office building in the borough’s NoMad neighborhood to Haddad Brands. The deal was announced in early December as what would have been the largest office sale of the year in New York City, according to The Real Deal. The 1928-built asset previously changed hands for $565 million in 2007, when Morgan Stanley picked it up from L&L Holding Co.

Fried Frank advised Haddad Brands during negotiations, with the seller planning to occupy the property. The asset was last upgraded in 2011, rises 345 feet and includes 41,465 square feet of retail space

• 470 Park Ave. S., Manhattan

Sale Price: $147.5 million

A week later, another NoMad property changed hands: Williams Equities acquired the 227,053-square-foot office asset at 470 Park Ave. S. from SJP Properties and PGIM Real Estate. The buyer secured acquisition funds in the form of an $100 million senior loan via a consolidated note that replaced a previous $56 million debt, and a $10 million second loan, both originated by MetLife Real Estate Lending.

The 17-story building previously traded in 2018 for $245 million. Originally completed in 1925 and last updated in 2012, the office property features 19,000 square feet of retail space. Its tenant roster includes M&T Bank, Kiko USA and Array Architects, among others.

• 767 Third Ave., Manhattan

Sale Price: $88 million

Nathan Berman’s Metro Loft Management picked up the Turtle Bay property from Sage Realty. Eastdil Secured negotiated on behalf of the seller.  Metro Loft Management secured a $55 million acquisition loan from Bank Hapoalim International.

The 286,212-square-foot office building rises 40 stories and dates back to 1980. Tenants here include Acacia Research Corp., Harvest Capital Credit Corp. and The Cole Group, among others.

The buyer formed a joint venture with Quantum Pacific Group to convert the half-vacant property to residential, under the City of Yes housing reform, according to The Real Deal. The 286,212-square-foot office building rises 40 stories and dates to 1980.

• 1370 Broadway, Manhattan

Sale Price: $75.3 million

American Exchange Group purchased the 234,846-square-foot property, also known as the Fischel Building, from Invesco Real Estate. The buyer closed the acquisition through Sentry Realty, its real estate arm, in partnership with 60 Guilders. Fortress Investment Group provided acquisition financing totaling $66 million through two loan agreements.

The deal closed at a significant discount when compared to the previous sale in 2014, when Invesco paid $186 million. Located in the borough’s Garment District, the 16-story asset was completed in 1922 and includes 5,000 square feet of retail space.

• 24 W. 57th St., Manhattan

Sale Price: $67.2 million

The Central Midtown office building changed hands from APF Properties to Soloviev Group. The seller marketed the property as a development site after it defaulted on a $48.9 million CMBS loan.

Soloviev Group owns multiple plots in the area, as well as the office tower across the street. While it remains unclear what will happen to the new asset, the buyer will likely build a luxury condominium asset, according to Commercial Observer.

Also known as The New York Gallery Building, the property is totaling 110,808 square feet and includes 88,722 square feet of office space and 13,246 square feet of retail space. Originally completed in 1928 and upgraded in 2009, the 20-story building is leased to Galerie St. Etienne, Michelle Roth Design Studios and luxury brand Riflessi, among others.

—Posted on February 25, 2025

The post Top 5 NYC Office Building Sales—January 2025 appeared first on Commercial Property Executive.

RFR has recapitalized 475 Fifth Ave., a 275,738-square-foot trophy office asset in Manhattan, securing new debt and equity and escaping foreclosure.

The deal includes a new three-year loan amounting to $160 million issued by Citibank and JPMorganChase. The same lenders had held the previous $180 million property debt due in September 2024, according to CommercialEdge information. The recapitalization also includes the infusion of new capital, although the new equity partners remain anonymous.

RFR had partnered with Penske Media Corp. to purchase the asset in 2022. Nuveen Real Estate sold 475 Fifth Ave. for $291 million, CommercialEdge shows, after having invested $60 million in capital expenditures nine years prior.

The 24-story building debuted in 1926, its floorplates ranging from 4,103 to 18,382 square feet. Amenities comprise a newly renovated lobby and a public art program, to name a few. The property achieved LEED Silver certification in 2015.

READ ALSO: 2025 Top Commercial Mortgage Banking and Brokerage Firms

The property is more than 90 percent leased, according to Commercial Observer. Its largest tenant is Penske Media, which signed a long-term lease for nearly 110,000 square feet. The roster also includes design firm Stantec and investment company Kylin Management.

New York Public Library is across the street from 475 Fifth Ave., while Grand Central and Bryant Park are within walking distance.

RFR’s road to stabilization

RFR’s New York portfolio nears stabilization through recent recapitalizations, Co-Founder & Principal Aby Rosen said in prepared remarks. This month, the company landed a $1.2 billion CMBS note to refinance 375 Park Ave., according to multiple sources. The loan retired the office tower’s previous $1.1 billion debt.

The company rounded up 2024 with another significant office deal, having obtained a three-year extension for the note encumbering 17 State St. The 571,000-square-foot property was subject to a $180 million CMBS loan originated by JPMorganChase.

Manhattan’s mixed office signals

Manhattan’s office market has seen significant changes across several key markers since the beginning of the year, according to a recent CommercialEdge report.

The borough’s vacancy rate climbed only 10 basis points year-over-year to 16.6 percent in January—well below the national average of 19.7 percent. Meanwhile, listing rates dropped 3.6 percent year-over-year and settled at $68.2 per square foot, while the national office rents were up 5.8 percent during the same interval.  

However, office lending has shown signs of revival. Earlier this month, Ivanhoé Cambridge secured a $1.12 billion loan for the refinancing of a 42-story trophy tower in Midtown Manhattan.

The post RFR Recaps Manhattan Office Tower appeared first on Commercial Property Executive.

Until a few months ago, C-PACE in NYC was limited to financing just qualifying retrofits of existing buildings. Investors found it difficult to use due to high barriers to entry and excessive qualification standards. This, combined with elevated program costs and onerous requirements—and especially during the years of low interest rates—pushed borrowers toward other, more attractive alternatives for financing, recalls Cliff Majersik, senior advisor at the Institute for Market Transformation.

READ ALSO: Why C-PACE Lenders Remain Resolute

“C-PACE was a financing option of last resort for energy upgrade projects under $10 million in NYC,” confirmed Lucas Nagy, vice president of structure finance at EcoSmart Solution, Taurus Investment Holdings’ energy platform.

Simply put, C-PACE’s improvement in borrowing rate over conventional equipment financing was not worth the additional upfront costs and administrative headaches for most property owners in NYC. Additionally, Freddie and Fannie were not providing lender consent to C-PACE, so even if a multifamily property owner wanted to use C-PACE, their lender would not allow it, Nagy pointed out.

New parameters for C-PACE in NYC

In late 2024, C-PACE in NYC was amended to include new construction projects and the maximum loan term was increased to 30 years. This lengthy procedure took note of the city’s local PACE law, and involved a NYC administrative rulemaking process and revised guidance from the New York State Energy Research and Development Authority. The passage of the NYC “gas ban bill” in 2021 also impacted the framework, noted Curtis Probst, president of New York City Energy Efficiency Corp., a nonprofit that also serves as administrator for NYC’s C-PACE program.  

Following the introduction of the new guidelines, the market appears to be in for a green surprise, as funding for new construction is the most common application for C-PACE financing around the country, according to Michael Doty, senior director of originations at Nuveen Green Capital, a company that surpassed $3 billion in C-PACE originations last year alone.

New construction projects in NYC are now PACE-eligible and automatically qualify for funding equal to 30 percent of hard costs, provided that the building is designed following a suite of energy efficiency measures considered best practice for new buildings today, including all-electric, clarified Jacob Roth, vice president of project underwriting and C-PACE Programs at PACE Loan Group.

In addition, new construction projects that comply with an electrification requirement are exempt from the cost-benefit-ratio calculation. “Since the NYC C-PACE program contains the ‘all-electric’ requirement for new construction projects, there is no CBR requirement for new construction projects,” said Probst.

Retrofit programs were also expanded last year to include an updated list of prequalified improvements, making C-PACE requirements less stringent for users. The new guidelines exempt retrofit projects of low-carbon buildings, which must not use fossil fuels for any major building system. “Buildings eligible for C-PACE will have the lowest possible carbon impact throughout their life,” noted Doty.

C-PACE in NYC projects

111 Wall Street

Just a handful of projects in NYC used C-PACE since its launch four years ago. But it started loud, with an $89 million C-PACE transaction in 2021, issued by Petros PACE Finance for 111 Wall Street, a 25-story building in Manhattan’s Financial District. At that time, it was also the largest single C-PACE transaction ever closed in the U.S.

The PACE financing was part of a $500 million acquisition and reposition financing closed by the building’s joint venture partners, Wafra Capital Partners and Nightingale Properties.

The planned PACE-eligible renovations at the 1.2 million-square-foot tower included a full upgrade to the building’s facade and a complete remake of the HVAC air conditioning and MEP systems, as well as fully redundant power systems.  

730 Third Avenue

Another prominent project that used C-PACE financing was TIAA’s 730 Third Avenue, Nuveen’s NYC headquarters in Midtown Manhattan. In the fall of 2021, Greenworks Lending (now Nuveen Green Capital) provided $28 million C-PACE financing with a 25-year financing term, backing a $120 million renovation plan.

The C-PACE amount was used for multiple energy efficiency measures, including lighting, roof insulation and replacement of all windows with smart windows that adjust to light automatically to help control the temperature inside the building.

The C-PACE financed measures also helped reduce the property’s greenhouse gas emissions, supporting the building in averting nearly $100,000 in annual fines under the city’s Local Law 97 of the Climate Mobilization Act.

Brooklyn United Methodist Church Home

The Brooklyn United Methodist Church Home in Brooklyn has been operating for 150 years. Founded as an elderly housing community, it now serves as a skilled nursing facility with 120 beds. In 2023, the property was granted a $5 million C-PACE loan for energy improvements to ensure compliance with New York’s Building Performance Standards.

In this case, the developer sought retroactive refinancing for the installation of a combined heat and power system for the facility, and financing for further improvements including a new boiler, lighting system and air-handling units. These energy improvement measures funded by PACE Equity led to a reduction in carbon emissions by 265 metric tons per year, placing the property well below the 2024 emissions limit, and ensuring the building complies with Local Law 97.

66 Main

Bayview PACE closed $3.5 million in C-PACE financing in 2024, for a mixed-use asset at 66 Main St. in Yonkers. The 10-story property encompasses 170 apartments and 19,900 square feet of retail space on the ground floor. The loan utilized a combination of retroactive C-PACE and future PACE-eligible tenant improvements. The funds were used for energy efficiency upgrades, HVAC repairs and replacements.   

Dutch Meadows

Also in 2023, PACE Equity issued a $2.7 million loan for the first new construction of a 104-unit multifamily project, in Schenectady, N.Y., dubbed Dutch Meadows. The developer leveraged low-cost and non-recourse funding from PACE Equity to improve the project’s IRR while developing an energy-efficient multifamily project.

What’s behind C-PACE deals?

The verve around sustainability, energy efficiency and green building begs the question: How much of C-PACE do investors need to fill their capital stacks, and how much is ESG-driven?

Overall, this financing tool is primarily being used to reduce reliance on more expensive sources of debt or equity, with some investors also seeing it as a tool to further ESG goals, said Roth. For developers who are undertaking the development of green buildings to fulfill ESG commitments, C-PACE acts as a built-in reward for those choices. For developers looking for creative ways to complete a capital stack, “C-PACE helps make good design, good business,” according to Doty.

The reality is that C-PACE is a valuable financing instrument that works well in certain instances depending on project characteristics, alternative sources of capital and market conditions, believes Probst. “While some investors are interested in the ESG aspects, to date, we have not seen ESG considerations driving transactions,” he added.

Another development for C-PACE is increasing bank acceptance of partnering with it. “More and more traditional lenders are warming up to C-PACE, both because it preserves their senior loan position and because their client, the owner/developer, enjoys significant benefits through a more optimized capital stack,” Anne Hill, SVP, Bayview PACE, told CPE last year. “Banks recognize that C-PACE can fill gaps in the capital stack to get deals back on track when conditions are tight,” she added. With C-PACE non-recourse financing, the bank remains in the lead position in the event of loan defaults.

2025 expectations

This financing tool saw considerable growth during the high interest rates period. So with lower interest rates now and an updated requirements list, will C-PACE in NYC show growth or soften?

While we have seen the Fed cut rates a few times last year, we haven’t seen a corresponding decline in commercial real estate rates, Roth pointed out. But should we see this decline, C-PACE will continue to be attractive as investors look to capitalize on that momentum, he believes.

C-PACE financing volumes are partially a function of the absolute level of interest rates, and of equal or greater importance, is the relative attractiveness of C-PACE versus other financing sources. “While this relationship changes over time, we believe that increasing stakeholder familiarity with C-PACE, and the changes made to the NYC C-PACE program, will support broader adoption of PACE,” expects Probst.

C-PACE is an incredibly adaptable financing tool, Doty said, as it grew quickly and consistently throughout the country during a historically low-interest rate environment. While certainly the reduction in bank liquidity and rising interest rates drove C-PACE adoption in the last couple of years, growth is expected, even in a declining interest rate environment.

Nagy believes that sophisticated asset-backed securities investors understand the low, long-term risk that C-PACE provides relative to other real estate-secured debt instruments. The financing instrument is programmatically designed to fund low-risk energy improvements that, in turn, yield increases in property operating income. Securing C-PACE financing means getting stabilization-priced debt before the property has stabilized or restabilized.

The post C-PACE in NYC: Will the Program Finally Take Off? appeared first on Commercial Property Executive.

Aaronson Rappaport Feinstein & Deutsch LLP has decided to have its headquarters remain at the Grand Central district tower through at least 2042, having signed a 15-year lease extension with L&L Holding Co.

The space totals 55,269 square feet at 600 Third Ave., the firm’s contemporary 42-story Midtown East office tower, where it has been a tenant since 2010. The law firm will maintain the 42,764 square feet it occupies on the fifth and sixth floors.

Another law firm, Bond Schoeneck & King, signed a seven-year lease extension at 600 Third Ave. It has occupied space there since 2014. It will maintain the 12,505 square feet it occupies over the whole 22nd floor through at least 2033.

The property at 600 Third Ave., built in 1970, carries 575,254 square feet over the entire western blockfront between East 39th and East 40th Streets. It was recently renovated, including lobby upgrades and building system improvements.

READ ALSO: Top 100 Office Leases of 2024 Point to Stabilization

L&L Holding was represented by an in-house team of Jonathan Tootell, Tanya Grimaldo and Giannina Brancato. Mark Weiss and David Mainthow of Cushman & Wakefield, and Larry Bank of Matador Capital Management represented Aaronson Rappaport.

Bond Schoeneck & King was represented by Jeffrey Peck and Daniel Horowitz of Savills.

Peck told Commercial Property Executive that pockets of the NYC real estate market are tightening.

“However, there are still many value opportunities available,” Peck said. Most landlords are willing to negotiate beneficial deals for tenants that include building space with no out-of-pocket costs—including furniture and wiring, he added.

“It’s still a favorable time to be a tenant, especially when partnering with a real estate advisor who knows which landlords are ready, willing and able to compete for high-credit occupiers.”

Flight to quality as the new standard

Some Midtown NYC corridors are seeing premium office rents approach pre-pandemic levels while lease activity is booming, according to Lisa Flicker, senior managing partner & head of real estate at Jackson Lucas. In these areas, availability has dropped to its lowest point since 2021, signaling a robust recovery in prime office space.

“Reflecting the momentum in executive hiring within the office asset class, the premium sector is experiencing a notable rebound,” Flicker said.

The flight to quality is no longer a trend but the new standard, driven by companies reassessing remote work and increasing demand for high-quality, centrally located office spaces, she explained.

As firms push for more in-office time from their executives and team members, they raise the bar by investing in workplaces with top-tier amenities like fitness centers, cafes, conference rooms, outdoor spaces and childcare facilities. “Beyond perks, I see in-office factors like air quality and lighting becoming factors in attracting top talent,” Flicker added.

Leasing activity in Midtown saw remarkable growth in the fourth quarter of 2024, a strong sign of a continued rebound for the sector, according to AmTrust RE President Jonathan Bennett.

“Primely located office buildings with access to numerous transportation options and quality retail and restaurant offerings continue to see strong tenant demand,” Bennett told CPE.

The upward trajectory for these assets led to AmTrust RE’s acquiring 360 Lexington Ave., a 24-story office tower steps from Grand Central, late last year. “With a positive outlook on the future of Midtown’s market, we expect modern, tenant-focused office properties to continue seeing strong leasing activity,” Bennett said.

Given the “return to office” mindset in many industries across the city and the U.S., many people want to live near work.

For example, at The Perrie condo development on 234 East 46th St., more than 50 percent of buyers and prospective buyers work just blocks away at an office ideally located like 600 Lexington, according to Nick Riback of Corcoran.

Nearby 520 Fifth Ave. is set to offer over 200,000 square feet of boutique office space and residences, with over 90 percent sold. This property, on the same street as the Empire State Building, will be the second-tallest building on Fifth Avenue and a 10-minute walk from the 600 Third Ave. property. JLL is the leasing company for the building’s commercial office space.

Two years ago, law firm Polsinelli extended and expanded its lease at L&L Holding Co.’s 600 Third Ave., signing a 10-year extension through 2036 at the 42-story skyscraper, adding 13,129 square feet on the 33rd floor.

The post L&L Holding Signs Lease Extensions in Manhattan appeared first on Commercial Property Executive.

SPARC Kips Bay will transform an entire city block at East 25th Street and First Avenue on Hunter College’s Brookdale Campus into a life science innovation, career and education hub with more than 2 million square feet of academic, public health and life science space. The project was first announced in October 2022 and is expected to create more than 3,100 permanent jobs and generate $42 billion in economic impact over the next 30 years. NYCEDC expects to start deconstruction of the campus by the end of this year.

The Innovation East development, basically around the corner at 455 First Ave., will replace the former Public Health Lab with a new life science hub. The Public Health Lab will relocate to a new, modern facility at Harlem Hospital, which is expected to be complete by the end of this year. Demolition of the existing 455 First Ave. building is expected to take place in 2026, with construction of Innovation East starting in 2027.

To dive more deeply into SPARC Kips Bay, the campus will include life science research labs for companies of various sizes; clinical classrooms and teaching labs for three City University of New York schools: Hunter College School of Nursing, CUNY Graduate School of Public Health & Health Policy and Borough of Manhattan Community College; outpatient ambulatory care services and a training simulation center for NYC Health + Hospitals (H+H); a new forensic pathology center for the Office of the Chief Medical Examiner; and community and retail spaces.

The project will also feature more than 1.5 acres of public improvements, including new publicly accessible open space, a new ADA-accessible 25th Street pedestrian bridge over the FDR Drive, streetscape improvements and flood protection measures.

READ ALSO: Life Science Trends to Watch in 2025

In February 2024, NYCEDC issued a Request of Expressions of Interest to identify a tenant to operate a life science center at SPARC Kips Bay. NYCEDC will potentially allocate up to $100 million of city capital in support and expects to announce its selection in the spring.

In the meantime, last September NYCEDC chose Skanska as the construction manager to oversee SPARC’s first phase, of more than 600,000 square feet, following deconstruction of existing buildings on the Hunter College campus. The total anticipated contract award was expected to be about $1.6 billion, and construction is scheduled to begin at the end of this year and to be completed in 2031. 

The total anticipated contract award is expected to be in excess of $1 billion, and construction is expected to begin at the end of this year and to be completed in 2031.

Currently, NYCEDC expects to release an RFP seeking developers to build 1 million square feet of life science space and modern facilities for H+H and OCME as part of SPARC’s second phase.

The 500,000-square-foot Innovation East will be more or less just across First Avenue from SPARC, at 455 1st Ave., and will have the potential to create more than 1,000 permanent jobs. New York City’s own Taconic Partners is among the major players in this project, having conceived it in response to an RFEI from the city in 2018.

NYCEDC did not reply to Commercial Property Executive’s request for additional information.

Addressing the labor shortage

To the extent that this expansion of the Kips Bay Science District is aimed at connecting the projects’ eventual tenants into New York City’s educational institutions, this could be a smart strategic move.

A mid-2024 life sciences outlook from Cushman & Wakefield remarked that even though hiring in the sector was lackluster, finding talent to fill certain positions remains challenging in today’s labor market. In some markets, employers must post job openings up to five times to fill specific roles, according to the report.

In New York City, Cushman & Wakefield reported, life sciences job postings were open for a median of 24 days.

The post NYC Projects Worth $1B Get Green Light appeared first on Commercial Property Executive.

MLB Network is planning to move all operations to 25 Market St. in Elmwood Park, N.J. The content platform of Major League Baseball will occupy the entire 207,000-square-foot building that was developed by Crow Holdings and completed last year. CBRE negotiated the lease on behalf of the tenant, while JLL represented the owner.

MLB Network will relocate from Secaucus, N.J., where it has been since its opening in 2009. The platform will be fully operational at the new location by the 2028 baseball season.

READ ALSO: Top Destinations for Corporate Relocations

MLB Network creates about 3,000 hours of live programming each year, and it is also a production house. The platform helps produce content for MLB Local Media, Friday Night Baseball on Apple TV+, Roku’s MLB Sunday Leadoff, and MLB’s digital platforms and partners. All together, MLB Network created more than 400,000 pieces of content for all of MLB’s platforms in 2024.  

Out of the ashes

The warehouse rises on the former site of the Marcal Paper Mills factory, which had been there for about 90 years. In 2019, most of the 36 structures on the Marcal site burned down in a fire.

The developer acquired the 12-acre parcel in 2022 and built the facility on speculative basis. A brick facade and black window mullions inspired by the original industrial property pair with large, translucent light boxes in a design that is new, but also plays tribute to the former factory.

Designed by M+H Architects, the facility has 32 dock positions, two drive-in doors, a 60-foot speed bay and an interior clear height of 40 feet. The building will house all of the network’s production studios and offices, along with MLB’s video tape library.

Scott Gottlieb, Brendan Herlihy, Greg Barkan and Elliot Bok of CBRE represented MLB Network in the lease. The JLL team of Rob Kossar, David Knee, Ignatius Armenia, Chris Hile and Ryan Milanaik assisted Crow Holdings Development. 

Vacancy plateaus in New Jersey’s industrial market

Leasing volume in the New Jersey industrial market came in at 12 million square feet in the fourth quarter, which was higher than the trailing eight quarter average of 9.5 million square feet, according to JLL. Third-party logistics represented much of the demand.

That volume of leasing, along with a slowdown in new construction deliveries, means that vacancy in New Jersey industrial is plateauing, JLL reports. Vacancy was up only 28 basis points on average each quarter in 2024, a moderation from 2023, when the increase averaged 77 basis points per quarter.

Product construction is at its lowest point in two and a half years in New Jersey, JLL notes. The volume of new development is expected to remain around the 15 million-square-foot mark.

The post MLB Network to Relocate New Jersey HQ appeared first on Commercial Property Executive.

Stark Office Suites has extended its lease at Jack Resnick & Sons’ 110 E 59th St. in Manhattan by 10 years. The flexible office space provider occupies the 22nd and 23rd floors of the 612,181-square-foot building. 

In conjunction with the renewal, Resnick and Stark have agreed to partner on upgrading the 26,568 square feet the latter occupies at the property. Renovations will include improvements to the reception, common areas, meeting spaces, kitchenettes and restrooms.  

Stark Office Suites opened its first locations in 2004 and has since grown to 13 flex office spaces across New York City, Westchester, Long Island and Connecticut.

A Manhattan tower on 59th Street

Completed in 1969 by Resnick & Sons and designed by W. M. Lescaze, the high-rise on 59th Street rises 37 stories just off Park Avenue in the Plaza District.

Its tenant roster features Zelnic Media Capital, Royalty Pharma, Cantor Fitzgerald and Estee Lauder. The property was awarded the LEED-Gold certification for operation and management, according to CommercialEdge information.  

There were 273 coworking locations in Manhattan as of November, totaling 11.3 million square feet, CommercialEdge research shows. Trailing behind Manhattan, Chicago and Washington, D.C., have 6.8 million square feet and 6.7 million square feet, respectively, out of the 136.3 million square feet of flex office spaces across the U.S.

The post Stark Office Suites Extends Manhattan Lease appeared first on Commercial Property Executive.

A three-building, 261,950-square-foot light industrial portfolio in the New York metro’s Rockland County has changed hands for approximately $62.8 million after nearly four years of ownership by Lincoln Equities Group and PCCP. Invesco Real Estate acquired the I-287 Multi-Tenant Light Industrial portfolio in Valley Cottage, N.Y.

JLL Capital Markets represented the sellers, which teamed up for the first time in April 2021 to purchase the three-building industrial portfolio from Sasson Real Estate Group in a deal valued at $48.5 million. The ensemble is now 97 percent leased to 17 tenants from a variety of industries including logistics, storage, sales, showrooms, servicing and health care.

The 64,000-square-foot 711 Executive Blvd. dates back to 1999 and is located on 9.3 acres, according to CommercialEdge. Completed in 2008, 616 Corporate Way and 618 Corporate Way sit on nearly 14 acres, encompassing 85,790 and 112,160 square feet, respectively.

READ ALSO: Manufacturing Demand for Industrial Space Is Mushrooming

The buildings have suites ranging from 2,720 to 42,075 square feet. They feature a mix of traditional warehouse space with clear heights up to 30 feet and shallow-bay light industrial space with 20-foot clear heights. 711 Executive Blvd. has a total of 234 parking spaces while the buildings at 616 Corporate Way and 618 Corporate Way have 170 parking spaces.

The location offers connectivity to the affluent and densely populated markets of Bergen County, N.J., Westchester County, N.Y., and New York City. Situated just off Route 303, the portfolio is 3 miles from Interstate 287 and less than 6 miles from the Mario M. Cuomo Bridge, formerly known as the Tappan Zee Bridge, which connects Rockland and Westchester counties. The highway system in the area provides access to more than 980,000 consumers within a 30-minute drive and more than 9.8 million consumers within a one-hour drive.

More Lincoln, PCCP deals

Based in East Rutherford, N.J., Lincoln Equities Group owns, operates, develops and manages commercial and residential properties throughout the Northeastern region and Europe. In April, Lincoln closed on a $53.5 million senior construction loan provided by PCCP to develop Belleville Logistics, a two-building, 15-acre last-mile logistics campus in Belleville, N.J.

In December, PCCP and another partner, Distribution Realty Group, began construction on Middle Tennessee Industrial Center, a four-building, 703,902-square-foot speculative project in Murfreesboro, Tenn., in the Nashville, Tenn., market. The project is slated for delivery later this year. A month earlier, PCCP formed a joint venture with CRG to develop The Cubes at Alpha, a 575,900-square-foot industrial park in Alpha, N.J.

Invesco industrial activity

Invesco has been active in both developing and acquiring industrial assets across the country. In August, Invesco and IndiCap completed the first phase of Virgin Industrial Park, three facilities totaling about 1 million square feet in Glendale, Ariz. Two more buildings are planned, bringing the park’s total space to 1.5 million square feet.

The firm paid $55 million for a 216,000-square-foot building in South Brunswick Township, N.J., last February. At the time of the sale, the property was fully leased to a third-party logistics company. That same month, Invesco and four partners who own Currwood Logistics Center, a 1.5 million-square-foot Hagerstown, Md., industrial campus, inked a full-building, 1.2 million-square-foot lease with an online restaurant supply company.

The post Invesco Pays $63M for Suburban NY Industrial Portfolio appeared first on Commercial Property Executive.

Simon Property Group Inc. plans to begin a multimillion-dollar transformative project of Smith Haven Mall, a 1.2 million-square-foot shopping mall in Lake Grove, N.Y., on Long Island. The extensive redevelopment will start this summer, targeting completion in 2026.

The renovation project will improve both the exterior and interior spaces of the property. The exterior will be repainted with new signage and entryways. Inside, Smith Haven Mall will have updated flooring, modern fixtures and a revitalized Center Court. The food court will also be transformed with new seating. Outdoors, a green plaza with landscaping and seating areas will be added.

The mall revamp will also feature tenant additions. Zara will open its first location in Eastern Long Island at the property in 2026, Sur la Table will open this fall and Golf Lounge 18 is set to open in March.

READ ALSO: What’s in Store for Retail in 2025?

Smith Haven Mall—originally known as Nesconset Shopping Center—opened its doors in 1969. Since 1995, it has been managed by Simon Property Group. The property has undergone several renovations and expansions over the years, becoming a key shopping destination in the region.

The mall’s tenant roster currently includes more than 130 regional and national retailers such as Barnes & Noble, Apple, Guess, H&M, Claire’s, White House Black Market, LoveSac, Dick’s Sporting Goods, Forever21, Sephora, The LEGO Store, The Cheesecake Factory, Ruth’s Chris Steakhouse, Starbucks and Bahama Breeze.

Located at 313 Smith Haven Mall, the retail property is at the intersection of highways 25 and 347.

Simon’s recent activity

Simon currently has roughly $8 billion in assets under management across the globe and its portfolio encompasses more than 400 retail properties across 24 countries.

In September, the firm updated and extended its $3.5 billion multi-currency unsecured revolving credit facility. This amendment increased Simon’s financial flexibility, giving it a total of $8.5 billion in revolving credit capacity.

And this January, the REIT announced plans to develop Nashville Premium Outlets, a 325,000-square-foot luxury shopping and lifestyle destination, starting next year. The company agreed to purchase a large site in Thompson’s Station, Tenn., and construction expected to begin in 2026.

The post Simon Eyes Long Island Shopping Mall Revamp appeared first on Commercial Property Executive.

On a global level, average net effective costs for prime office space rose by just 0.1 percent compared to the third quarter. The increase was driven by a 0.3 percent growth in gross rental rates and an uptick of 0.2 percent in fit-out costs, moderated by landlord concessions. Overall, the upward trend for the year stood at 1.9 percent.

With a net effective cost to occupier of $206.7 per square foot annually, Midtown Manhattan ranked third among the 35 global markets Savills covers, outpaced only by London’s West End ($277.5) and Hong Kong ($230.4).

The report also highlighted Los Angeles, with a spotlight on Century City. Savills reported that this submarket in particular saw a 5 percent net effective cost-to-occupier growth last quarter.

“With its collections of trophy assets and reputation for safety and extensive retail options, Century City represents one of the best-performing submarkets in Los Angeles,” Henry Gjestrum, JLL research manager in Los Angeles, told Commercial Property Executive.

Nearly 1.6 million square feet of leasing activity has taken place in Century City over the last 12 months, pushing forward the market’s recovery, he added.

Century City is the only market in Los Angeles that has an office tower under construction with a significant amount of preleasing. Office asking rents in this submarket are 81 percent higher than the rest of Los Angeles, according to Gjestrum.

Trophy assets are leading the way in practically every other primary U.S. market, just like in Century City, Jim Schoolfield, managing director at JLL in Los Angeles, told CPE.

“Century City benefits from most tenants being in professional services space where the return to office mandates have been highest,” Schoolfield said.

READ ALSO: Top 100 Office Leases of 2024 Point to Stabilization

Landlords have heavily invested in creating world-class amenities to attract the premier tenants, he added. “Rent growth has been 4 percent from the fourth quarter of 2023 to the fourth quarter of 2024, and the average asking rate is $7.58 per square foot for Class A space, which far outpaces the rest of Los Angeles.”

According to Schoolfield, among the top nine assets in Century City, only 20 full floors are available directly, with a vacancy of 11.4 percent.

“To deal with competing demand, the larger tenants must transact at least 24 months before any lease commencement,” Schoolfield said.

Century City, an outlier

Los Angeles—specifically Century City—is an outlier, according to Eric Segal, MAI, senior managing director of Integra Realty Resources’ Los Angeles office.

“Our data supports the trend highlighted by Savills,” he told CPE. “Century City recorded some of the strongest leasing volumes since early 2020, with intense demand for premium office space driving effective rents higher. This underscores a broader pattern where top-tier assets in key locations thrive, while much of the office sector is still working toward stability.”

Speaking nationally, Segal said the U.S. office market is experiencing a sharp divide.

“While top-tier office buildings in select markets are holding steady or even seeing rental growth, the broader sector continues to struggle with high vacancies and evolving tenant needs,” he said. “The ‘flight to quality’ is real, but it’s happening alongside persistent challenges for aging, outdated office stock that lacks the amenities and flexibility today’s tenants require.”

Miami, New York City lead the way

Nowhere is demand for prime space more evident than in Miami, according to Tere Blanca, founder & CEO of Blanca Commercial Real Estate.

“Demand has been fueled by new-to-market tenants and a growing existing tenant base, sending asking rents skyrocketing,” she told CPE.

In prime (Tier I) CBD properties, asking rates have increased 7.2 percent year-over-year and an astonishing 67.8 percent since the end of 2019, Blanca added. In Brickell, where the only new supply delivered fully leased, prime asking rates have increased by 82 percent since the end of 2019.

“With no new supply expected in the CBD until the end of the decade, we expect owners to continue to mark to market vacant spaces and renew tenants. This will continue to drive healthy rate increases across the CBD market,” Blanca said.

The office sector appears to have bottomed out, with early signs of renewed transaction activity, according to Eli Randel, chief operating officer of Crexi.

“Blackstone’s recent high-profile acquisition in Manhattan suggests the worst may be behind us,” Randel said. “The divide between winners and losers remains stark—amenity-rich, Class A properties continue to attract strong occupancy, while much of the Class C inventory is increasingly becoming obsolete.”

As for national office traffic numbers, Placer.ai reported that nationwide office visits were 40.2 percent lower during January than in January 2019, likely due to a mid-week New Year’s holiday and a polar vortex making travel difficult in many cities.

New York City led for visit recoveries last month, with visits down only 19 percent compared to January 2019. San Francisco ranked last among the cities analyzed, with visits down almost 52 percent.

The rising demand for prime office space is primarily driven by the push for a return to the office, according to Kenneth Salzman, executive managing director & principal at Lee & Associates NYC.

“Many companies’ return-to-office initiatives include offering onsite amenities and securing office locations in desirable areas that address employee conveniences and reduce commute times,” Salzman said. “Midtown Manhattan is a prominent submarket for office space due to its central location, easy access and neighborhood amenities.”

The post Net Effective Office Costs Edge Up appeared first on Commercial Property Executive.

Hines, which serves as the 1.2 million-square-foot building’s asset manager and property manager, also participated in the deal, the funding of which was led by Wells Fargo, Bank of America and Bank of Montreal.

The building currently is 97.2 percent leased, with tenants including Salesforce, Stifel, Dechert LLP, US Bank, Lloyds Bank and Standard Chartered.

Ivanhoé Cambridge acquired 3 Bryant Park from EQ Office for $2.2 billion in early 2015, according to information provided by CommercialEdge. The building was completed in 1972.

READ ALSO: Top 100 Office Leases of 2024 Point to Stabilization

Ownership reportedly has been making ongoing capital investment since acquiring the property. Amenities include direct access to Bryant Park, on-site retail anchored by Whole Foods and Equinox, an outdoor plaza of more than 16,000 square feet, a new conference center, a sky lobby with a coffee bar and immediate access to the 42nd Street Subway station, serving the B, D, F, M and 7 lines. The property also features an array of dining options including Valbella, Shake Shack and Rosetta Bakery.

The JLL Capital Markets Debt Advisory team who represented the borrower was led by Senior Managing Directors Christopher Peck and Drew Isaacson, Managing Director Lauren Kaufman and Directors Jennifer Zelko and Christopher Pratt.

More demand for big bucks

Based on its location equidistant from multiple transit hubs, including Grand Central Terminal, Penn Station and the Port Authority Bus Terminal, the Bryant Park micro-market is one of New York City’s strongest office submarkets, JLL stated. Its current 0.8 percent vacancy for trophy assets compares favorably with other submarkets, and its rents are running about 50 percent higher than the average for Midtown Class A properties.

More broadly, with respect to the capital markets, JLL commented that current trends “indicate increasing liquidity for large office loans, buoyed by ample debt capital and increased confidence in the sector.”

To put that in numbers, since the third quarter of 2024, JLL has seen a significant surge in demand for large commercial real estate loans. That’s part of a nearly 30 percent rise in lender quotes for deals exceeding $100 million in the second half of 2024, versus the same period in 2023.

This past August, Yeshiva University signed a 32-year lease expanding its presence at Herald Center, in Midtown, to 160,000 square feet. The Class A property is owned by JEMB Realty, which represented itself in the lease negotiations; the university was represented by Savills.

Yeshiva University intends to use the additional space at Herald Center to expand its presence in the health sciences, such as occupational therapy and speech-language pathology.

The post Ivanhoé Cambridge Lands $1.1B Refi for Manhattan Tower appeared first on Commercial Property Executive.

The redevelopment is being financed by the United Nations Development Corp., a public benefit corporation founded in 1968, which will issue as much as $380 million in bonds for the project. Goldman Sachs and Siebert Williams Shank will be the underwriters for the financing.

The plan calls for a number of top-to-bottom building renovations, overseen by architectural firm Spacesmith, whose other projects include the U.S. embassies in Mexico City, Turkey and Indonesia, a number of consulates, the Staten Island Family Justice Center and the Queens Flushing Library, just among its civic designs. The scope of the UN Plaza project will be about 900,000 square feet.

Cushman & Wakefield manages the asset and is spearheading construction management of the renovation through its Project & Development Services team.

Cosentini Associates has been tasked for the mechanical, electrical and plumbing work, with Turner Construction Co. as the overall construction manager, which inked a Project Labor Agreement with the Building and Construction Trades Council. Work is slated to begin sometime in the second quarter and conclude in about two years.

New York City Mayor Eric Adams made the announcement, asserting that the plan would create about 18,000 jobs. As an employer, the UN is already one of New York City’s major ones, employing about 20,000 people, mostly in office positions.

READ ALSO: When Office Meets Hospitality

Besides cosmetic upgrades, the buildings will receive up-to-date energy efficiency systems under the aegis of the state’s BuildSmart 2025 initiative, whose goal is to achieve 11 trillion BTU of energy savings at state facilities this year. By way of comparison, total energy production in the entire state (in 2022) was 512 million BTU, according to the U.S. Energy Information Administration.

Other renovations will be undertaken by tenants in their own space, and there will also be building-wide fire safety system upgrades, and changes to align the structures with updated disability codes and regulations. CBRE acted as advisor to UNDC in the project, and Newmark acted as advisor to the UN for the project.

A slice of history

Famed worldwide, the 1950s UN headquarters building was only the initial development in Manhattan’s Turtle Bay neighborhood. The 358,000-square-foot One UN Plaza and the 369,000-square-foot Two UN Plaza, which include office space but also a hotel on the top floors, along with Three UN Plaza, were developed to meet the needs of the UN as it grew during the 1970s and ’80s.

The redevelopment of One and Two UN Plaza, which are owned by the UNDC, will enable further consolidation of UN personnel, according to the mayor’s office. The United Nations Children’s Fund, which maintains its global headquarters at Three UN Plaza, will own the building in 2026.

NYC office market sees renewed strength

The announcement comes at a time when the New York office market is making something of a comeback from pandemic-era lows. Net absorption for 2024 came in at a negative 5.7 million square feet, though total leasing was 38.1 million square feet, a post-pandemic high, according to Newmark data.

Though still negative, the 2024 absorption represented a considerable improvement for the Manhattan office market, and closer to pre-pandemic levels, such as in 2016, when absorption was exactly the same, Newmark noted. In 2020, there was negative absorption of 20.8 million square feet of office on the island, and in 2021 that total had expanded to 23.6 million square feet.

Overall availability in the Manhattan office market was down 70 basis points quarter-over-quarter in the fourth quarter of 2024, Newmark reported, to 17.9 percent. In Midtown, which includes Turtle Bay, availability contracted much more quickly, down 350 basis points between the third and fourth quarters.

Newmark also reported that leasing activity in Midtown rose to 27.8 million square feet in 2024, the highest level since 2019, and 23 percent higher than the historical long-term average for that metric.

The post United Nations Buildings to Undergo $500M Makeover appeared first on Commercial Property Executive.

Community Healthcare Network has signed a 12,083-square-foot, long-term lease at 44 W. 28th St., a 192,000-square-foot office building in Manhattan’s Flatiron District.

Denham Wolf Real Estate Services worked on behalf of the tenant, while CBRE represented the landlord, Stellar Management.

CHN is one of the largest affordable community health care providers in New York City. The tenant will relocate its headquarters at the building’s fifth floor, with moving-in scheduled for this fall. Other tenants include J.T. Magen & Co., YellowHammer Media Group and Stellar Management, according to CommercialEdge information.

The current ownership picked up the asset in 2007, in a $51.5 million deal and in 2019, the property became subject to a $78 million refinancing package, originated by Flagstar Bank, the same source shows.

Completed in 1911, the 16-story building underwent cosmetic renovations in 2008 and features five passenger elevators, 12,000-square-foot floorplates and 9,000 square feet of first floor retail space.

The property is across from Madison Square Park and the 28th Street subway station. John F. Kennedy International Airport is some 15 miles southeast.

Director of Occupier Services Lauren Davis and Transactions Manager Cameron Tuttle with Denham Wolf Real Estate Services worked on behalf of the tenant. CBRE’s Senior Vice President Caroline Merck and Vice President Jacob Rosenthal represented Stellar Management during negotiations.

Manhattan’s low vacancy

The office sector is expected to continue to struggle in 2025 as it’s still adapting to the post-pandemic changes, a recent CommercialEdge report shows. Despite return-to-office policies from some companies, the national vacancy rate clocked in at 19.8 percent as of December last year, marking a 150-basis-point increase over a 12-month period. Office vacancies continued to grow throughout 2024, with the six of the top 25 key markets witnessing an increase by more than 500 basis points.

Nevertheless, Manhattan marked the lowest office vacancy rate in the Northeastern U.S., with 16.6 percent as of December, while also being ranked the fifth lowest on a national level. The borough’s asking rents reached $68.4 per square foot—the highest in the North region and the second-highest in the U.S., after San Francisco’s $70.6 per square foot.

One of the largest deals closed recently was the 147,543-square-foot lease signed by The Federal Deposit Insurance Corp. The government agency will fully occupy three floors, as well as a partial floor for the next 10 years at the 1.6 million-square-foot, 1166 Avenue of the Americas.

The post Stellar Management Lands HQ Lease in Manhattan appeared first on Commercial Property Executive.

Oncology practice New York Cancer & Blood Specialists has signed a 35,469-square-foot lease at Youngwoo & Associates’ Radio Tower in New York City’s Washington Heights. The tenant will occupy the entire eighth, ninth and eleventh floors at the property starting this summer.

Avison Young and Savills worked on behalf of the ownership, while Schuckman Realty represented the tenant.

NY CBS has upward of 30 locations and 35 hospital affiliations in Bronx, Manhattan, Queens, Staten Island, and Brooklyn, as well as in Nassau and Suffolk counties. The oncology practice offers services such as imaging, therapy, surgery, on-site lab, psychology and nutrition, among others.

A mixed-use high-rise

Located at 500 W 181st St., the property has access to the Washington Bridge and Interstate 95. Yeshiva University is nearby, while Columbia Presbyterian Hospital is 1 mile away.

Radio Tower came online in 2022 as the first mixed-use development in Northern Manhattan in the last 50 years. The 22-story, 305,000-square-foot building comprises a 85,000-square-foot, 221-room hotel, 167,000 square feet of office space and ground floor retail. Amenities at the high-rise include tenant lounge, bike storage, rooftop bar and conference space, as well as indoor parking with 169 spots and a 13,000-square-foot event space.

Avison Young Principals Marty Cottingham and Michael Gottlieb, together with Director Patrick Steffens, Senior Director Joel Wechsler and Senior Associate Alexis Odgers worked on behalf of the ownership in the lease transaction. Savills Vice Chair Arthur J. Mirante, II assisted Avison Young. Schuckman Realty Associate Broker Ari Malul represented NY CBS.

Manhattan holds on

The office sector will continue to face challenges this year, as the pandemic effects on the market are still unfolding. Despite return-to-office policies from some companies, the national vacancy rate increased in 2024 and climbed to 19.8 percent at the end of December, a recent CommercialEdge report shows. One initiative in New York City is the Office Conversion Acceleration program which encourages adaptive-reuse practices such as converting buildings to data centers, coworking hubs and residential projects.

Nevertheless, Manhattan is staying afloat, registering a 16.6 percent vacancy rate as of December, posting a 20-basis-point increase over a 12-month period, according to the same report.

Among the largest deals closed recently was the 10-year lease signed by The Federal Deposit Insurance Corp. to occupy 147,543 square feet at the 1.6 million-square-foot, 1166 Avenue of the Americas in Manhattan.

The post Oncology Practice Signs 35 KSF Lease in Manhattan appeared first on Commercial Property Executive.

Rudin has secured another agreement for its 3 Times Square building in Midtown Manhattan, signing Spectrum Reach to an 11-year lease. The company will take over the 26th and 27th floors of the 30-story tower.

Spectrum Reach is Charter Communications’ advertising sales business. This fall, it will relocate from its current office at 1633 Broadway into what is also called the Thomson Reuters Building.

Spectrum Reach was represented by Robert Stillman, Cara Chayet and Liz Lash of CBRE. Thomas Keating of Rudin and the Cushman & Wakefield agency team of Ron Lo Russo, John Cefaly, Paige Engeldrum, Lou D’Avanzo, Mike Burgio and Dan Organ represented the ownership.

Rudin has been filling the 925,000-square-foot tower that overlooks the Hudson River lately. Remy Cointreau, Anchin, Block & Anchin and Touro University are other recent tenants. Thomson Reuters, an original tenant, has renewed.

Last February, law firm Kilpatrick Townsend & Stockton LLP signed a 10-year lease to take over the building’s 28th floor. In June 2023, Rudin signed a five-year lease with West Publishing Corp.

Focus on wellness and sustainability

The building, designed by Fox & Fowle Architects, opened in 2001 as the North American headquarters of Reuters Group PLC and received capital improvements through FXCollaborative in 2020. The work included a new, glass-walled triple-height lobby and a decorative sculptural façade screen, in keeping with the Times Square aesthetic.

READ ALSO: Office Sector Faces Ongoing Challenges Into 2025

Other upgrades include a touchless entry system, a fully renovated destination dispatch elevator system, a conference and event center, a coffee bar, a dining area and a fitness center with locker rooms.

The building’s floorplates range from 28,000 square feet to 35,000 square feet and are column-free.

WiredScore awarded the building a Platinum certification for its connectivity. It also gained a SmartScore Gold certification for its user experience and sustainability.

Additionally, the building achieved the WELL Health-Safety Rating for its efforts to emphasize health and wellness for building occupants. Its AI-driven Nantum OS improves building operational efficiency, decreases carbon emissions and optimizes indoor comfort.

The post Rudin Lands HQ Lease at Manhattan Tower appeared first on Commercial Property Executive.

• 133 Kent Ave., Brooklyn

Sale Price: $45.3 million

Joyland Group, in joint venture with Prospect Development, has acquired the 5,000-square-foot retail building in Williamsburg from L3 Capital. The buyer secured $85 million in construction financing through a collateral mortgage provided by S3 Capital.

The partnership plans to continue and complete the conversion project at the property, that will result in a six-story mixed-use building with 43 condominium units and 17,500 square feet of retail space, according to CityBiz. The same source reveals that JLL represented the seller, procured the buyer and arranged the financing. The one-story building at 133 Kent Ave. was completed in 1950 and has 60,000 square feet of unused air rights.

• 690 Madison Ave., Manhattan

Sale Price: $34 million

Wharton Properties picked up the 6,620-square-foot retail property in Manhattan’s Lenox Hill from SL Green. According to The Real Deal, the buyer bought a 50 percent ownership stake from SL Green. The same source shows that Eastdil Secured represented the seller.

The five-story property includes 1,324 square feet of office space and 7,674 square feet of unused air rights. In a recent deal, Van Cleef & Arpels luxury jewelry brand signed a leasing agreement for all five floors, according to the company’s website.

• 422 Fulton St., Brooklyn

Sale Price: $23 million

Macy’s has sold the 438,498-square-foot retail portion of a 14-story building in downtown Brooklyn to three entities. The buyers include a group of investors led by United American Land, Crown Acquisitions and The Jackson Group. Totaling 844,378 square feet, the building dates back to 1920 and was used as a Macy’s department store that first opened in 1995.

Macy’s sold the property’s upper floors to Tishman Speyer in 2015, where the company constructed 622,000 square feet of office space, in a portion of the building dubbed The Wheeler. The remaining four floors that sold are part of Macy’s strategy to close up to 150 stores in the U.S., in a period of three years. In 2025, the company will close up to 66 locations, in an effort to turn a profit and invest in its remaining locations and brands.

• 17-23 Avenue of the Americas, Manhattan

Sale Price: $18.1 million

Local development company Sumaida + Khurana purchased the 11,700-square-foot retail building in the borough’s TriBeCa neighborhood from affiliates of the Matera family. Cerco Funding provided $15.3 million in acquisition financing for the buyer.

The three-story building includes 4,450 square feet of office space, as well as 2,800 square feet of residential space. The property was home to Tribeca Pharmacy, that vacated the building earlier last year, according to New York Business Journal.

• 9305 5th Ave., Brooklyn

Sale Price: $17 million

Staples Inc. has sold the 12,880-square-foot retail property in the Bay Ridge neighborhood to a private buyer. The new ownership secured a $10 million loan from Castellan Capital. The one-story property dates back to 1958 and served as one of Staples Inc.’s stores. It includes 65,130 square feet of additional air rights and is close to multiple bus stops, as well as to the Bay Ridge subway station on 95th Street.

—Posted on January 28, 2025

The post Top 5 NYC Retail Building Sales—December 2024 appeared first on Commercial Property Executive.

• 1375 Broadway, Manhattan

Sale Price: $ 170.4 million

American Exchange Group has acquired the 464,951-square-foot office building at 1375 Broadway, also known as Lefcourt State Building. The Garment District asset changed hands from Savanna Fund. The buyer closed the deal with a loan sale agreement that closed in August. The note included the acquisition of the debt behind the property, a $200 million loan dating back to 2020 originated by Aareal Capital.

American Exchange Group also secured $165 million in acquisition funds through an amended and restated note with Sail Harbor Capital as lender. The seller, Savanna Funds, will continue to operate the property, according to The Real Deal. The office asset rises 27 stories, dates back to 1927, includes 35,382 square feet of retail space and is LEED Gold-certified.

• 119 W.  57th St., Manhattan

Sale Price: $27 million

Zar Property N.Y. purchased the 14-story office building in the Central Park South neighborhood of Manhattan from GFP Real Estate. JPMorgan Chase issued a $26.5 million acquisition loan. The property also became subject to a $36 million loan as part of a consolidation and extension agreement that includes an office building in the Flatiron District.

Designed by architect Emery Roth, the office asset at 199 W. 57th St. was originally completed in 1926 and totals 112,147 square feet. The property also comprises 10,000 square feet of retail space.

• 79 N. 10th St., Brooklyn

Sale Price: $26.9 million

The 4,115-square-foot office building at 79 N. 10th St., together with the 30,953-square-foot building at 97 N. 10th St. changed hands from Cayuga Capital Management to BLDG Management. The buyer landed a $22.7 million acquisition loan originated by Manufacturers and Traders Trust Co.

The first property is a single-story building, while the second one rises two stories. Both properties are part of Brooklyn’s Williamsburg neighborhood.

• 15 W. 36th St., Manhattan

Sale Price: $21.5 million

Another Garment District asset changed hands in early December: Pyrus Management picked up the 80,500-square-foot office building at 15 W. 36th St. from Walter & Samuels. Avison Young represented the seller, according to New York Business Journal. The same source shows that the property was 61 percent leased at the time of the deal, and it has potential to be converted to multifamily use. The building rises 16 stories, came online in 1917 and includes 4,000 square feet of retail space.

• 104 Montgomery St., Brooklyn

Sale Price: $9 million

Real estate developer Shalom Stahler, through two legal entities, acquired the 12,393-square-foot office property in Brooklyn’s Crown Heights from two individual sellers. The two-story property was completed in 1920 as a heavy manufacture factory and comprises two residential units totaling 4,337 square feet. It is located in an Opportunity Zone and also includes 25,083 square feet of additional air rights.

—Posted on January 27, 2025

The post Top 5 NYC Office Building Sales—December 2024 appeared first on Commercial Property Executive.

IBM has inked a 15-year, 92,663-square-foot lease expansion at SL Green Realty Corp.’s One Madison Avenue in Manhattan. The agreement covers the property’s entire seventh floor, for which the asking rent was $110 per square foot, the Commercial Observer reported.

JLL’s Vice Chairman Patrick Murphy and Vice President Winston Schromm arranged the deal on behalf of IBM. SL Green was represented by JLL Vice Chairmen Paul Glickman and Alex Chudnoff, together with Executive Managing Director Ben Bass and Senior Vice President Diana Biasotti.

In 2022, IBM signed a 16-year, 270,000-square-foot lease at One Madison. The five-story office space opened September of last year.

SL Green acquired One Madison from MetLife Real Estate Investment in 2005. The 1.4-million-square-foot property traded for $801.7 million, according to CommercialEdge information. Last month, SL Green and its joint venture partners finalized a $1.25 billion mortgage modification and extension for the property, extending the final maturity date through November 2027.

A major adaptive reuse project

Originally built in 1893 to designs by Napoleon Le Brun & Sons, One Madison rises 26 stories in Manhattan’s Midtown South. SL Green, in a joint venture with National Pension Service of Korea and Hines, completed the property’s $2.3 billion redevelopment in September 2023. Architect Kohn Pedersen Fox oversaw the renovation, aiming to achieve LEED Gold certification. Amenities include an HVAC system that circulates 100 percent fresh air and a 7,000-square-foot tenant-only lounge, as well as several eateries and retail spaces.

One Madison’s tenant roster features Franklin Templeton, Coinbase and Palo Alto Networks, according to CommercialEdge. With IBM’s expansion, the office building is now 72 percent leased.

The office high-rise is across the road from Madison Square Park and the 23rd Street subway station and within a half mile of the Flatiron Building and Empire State Building.

The post IBM Expands Manhattan Office appeared first on Commercial Property Executive.

The buyer was not identified. Paramount will retain the 55 percent controlling interest and continue to manage and lease the property located between East 54th and East 55th streets in the Plaza District submarket.

The deal strengthens the New York City-based office REIT’s balance sheet and gives the firm flexibility in its capital allocation strategy.

Paramount, which owns, operates, manages and redevelops high-quality Class A office properties in select New York City and San Francisco submarkets, acquired the tower from The Carlyle Group in November 1999 for $163.2 million, or about $274 per square foot, according to CommercialEdge data. The latest transaction values the property at about $350 per square foot.

Building highlights

The LEED Gold-certified building was designed by Cesar Pelli, Viñoly Design Architects and Emery Roth and Sons and completed in 1983. The tower has 44,000-square-foot floorplates, exceptional light and views, as well as a superior location that provides access to eight subway lines and Grand Central Terminal.

The multi-tenant building has an 83 percent occupancy rate and 237,680 square feet of office space available, according to CommercialEdge. The property also has 14,805 square feet of retail space on the first floor and the underground level.

READ ALSO: What’s Defining Office in 2025?

Current tenants include Littler law firm, White Oak Healthcare Finance, FirstKey Mortgage, Zweig-DiMenna Associates, Carl Marks Management Co., Bank of America, Virtu Financial, Bank Negara Malaysia, Amber Capital Investment Management and RE Loewenberg Capital Management, according to CommercialEdge data.

Manhattan office market moves

Paramount had planned to sell the building several years ago but a deal with Aby Rosen’s RFR Realty to buy the tower for about $400 million fell apart in early 2020 as the COVID-19 pandemic hit America, shutting down all offices across the nation. Since then, Manhattan, like many U.S. office markets, has struggled to regain its footing and property values for many office buildings have declined.

But there are signs of improvement in the Manhattan office market and Paramount believes the sale of the non-controlling interest in 900 Third Ave. underscores the underappreciated value of the asset.

Tenants continue to flock to high-quality, newly built or recently redeveloped towers. In November, SL Green Realty Corp. closed on the sale of an 11 percent interest in One Vanderbilt, the 1.7 million-square-foot skyscraper in Midtown Manhattan, to Mori Building Co. Ltd. The deal valued the tower at $4.7 billion. SL Green maintained a 60 percent stake in the skyscraper that is now fully leased. The property’s other owners include the National Pension Service of Korea and Hines.

Cushman & Wakefield reported office leasing ended 2024 on a strong note with fourth-quarter new leasing totaling 6.7 million square feet—the highest quarterly total since the third quarter of 2022 and 6.3 percent higher than the 10-year quarterly average. The fourth-quarter Manhattan office report also stated there were 23 new and expansion leases greater than 100,000 square feet, up from 16 in 2023.

In the largest lease of the fourth quarter, Bloomberg LP inked a renewal and expansion lease at SL Green’s 919 Third Ave., a 1.5 million-square-foot, 47-story office tower. The deal brings the global publisher’s footprint to 924,876 square feet at the Midtown Manhattan high-rise. Bloomberg agreed to a 749,035-square-foot, 11-year lease extension starting March 1, 2029, and a new 175,841-square-foot 15-year expansion.

The post Paramount Sells Stake in NYC Tower appeared first on Commercial Property Executive.

Jay Suites and Jay Conference have signed a 12-year lease extension for 60,000 square feet of shared space at 515 Madison Ave., a 370,000-square-foot office building in Manhattan’s Plaza District. GFP Real Estate owns the 42-story high-rise.

GFP Chair Jeffrey Gural arranged the deal spanning floors eight to 10 on behalf of both parties.

The flex provider, the largest privately held coworking company in New York City, first signed a lease at the property in 2019, when it occupied two floors. Later, the firm committed to another floor that houses Jay Conference, a conference center model catering to large-scale meetings.

READ ALSO: Elevating the Coworking Experience

The 515 Madison coworking location comprises 101 furnished executive suites ranging from single-person units to 20-people team spaces. Additionally, there are four flexible meeting spaces with a capacity of up to 24 people, multiple business lounges and phone booths.

Jay Suites currently has 13 coworking locations across the city. In August, the firm paid $35 million for 8 W. 38th St., a 142,000-square-foot office building in Midtown Manhattan, 1 mile from 515 Madison Ave. That building houses the company’s new conference rental business, located on the mid-rise’s third floor.

A historical building in the Plaza District

Also known as the DuMont Building, the office tower at 515 Madison Ave. is close to Rockefeller Center and 1 mile from the Empire State Building. Designed by John H. Carpenter, the high-rise was completed in 1932 and went through cosmetic renovations in 2010, according to CommercialEdge information.

One of the property’s most notable features is its broadcasting antenna, which was involved in the inaugural broadcasts of Allen B. DuMont’s experimental television station in 1938.

The building features nine passenger elevators and 8,000 square feet of first-floor retail space, with floorplates ranging between 3,956 and 16,346 square feet, the same source shows. Its tenant roster also includes Manhattan Five Partners and Wildes & Weinberg, among others.

Coworking sector is on the rise

The coworking sector is seeing continuous growth, providing solutions that address the evolving needs of the workforce. Nationally, there were 7,538 locations recorded at the end of the third quarter of last year, reflecting a 7 percent increase from the previous quarter, according to a CommercialEdge office report. The total square footage reached 133.5 million, representing a 450-basis-point growth.

Manhattan led nationwide for coworking inventory, with 11.2 million square feet. And the borough’s stock will soon grow, as The Malin announced plans to open a 32,700-square-foot coworking space in the Flatiron District this spring.

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Private equity firm Incline Equity Partners has signed a 14,198-square-foot lease at 101 Park Ave., HJ Kalikow & Co. LLC’s Midtown Manhattan tower.

Incline Equity’s new space at the office building will be on the 47th floor, in addition to the existing 18,000-square-foot lease on the 46th floor. The company relocated to 101 Park Ave. in 2023, doubling its previous office space at 505 Fifth Ave.

JLL’s Vice Chairman Alexander Chudnoff, Senior Managing Director Nick Francic, Vice Chairman Harrison Potter and Senior Associate Kate Roush worked on behalf of the tenant, while Cushman & Wakefield’s Executive Vice Chairman John Cefaly and Managing Director Nicholas Dysenchuk represented the ownership in the transaction.

HJ Kalikow & Co. has owned and operated the property since it was built in 1982. The Manhattan tower is currently the subject of a $365 million 10-year fixed-rate loan originated by Bank of America in 2018, according to CommercialEdge information.

49 stories above Manhattan

The Class A, LEED Gold-certified property consists of 1.3 million square feet of space across 49 stories. The building features a five-story lobby entrance, as well as 30,000 square feet of retail space and a 17,000-square-foot, two-story museum. Amenities include full-time concierge services, Club 101, a dining club, a business and entertainment venue and a tech-enabled corporate event space. Federal Home Loan Bank of New York, Fox Rothschild LLP, Morgan Lewis and Hound Partners LLC are among the property’s tenants.

Located at the corner of 40th Street and Park Avenue, the office tower is less than 1 mile from the Grand Central – 42nd Street subway station, Bryant Park and Times Square.

Earlier this week, JLL and Colliers brokered a major office lease at 1166 Avenue of the Americas in Manhattan. The Federal Deposit Insurance Corp. signed a 10-year agreement to occupy 147,543 square feet at Edward J. Minskoff Equities’ property.

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The Federal Deposit Insurance Corp. has signed a 10-year office lease to occupy 147,543 square feet at the 1.6 million-square-foot, 1166 Avenue of the Americas in Manhattan. Edward J. Minskoff Equities owns condominium interests comprising floors two through 21—where FDIC will relocate—while Marsh & McLennan Cos. owns and occupies the remaining condominium interests.

JLL together with an EJME in-house team represented the owner, while Colliers led the negotiations on behalf of the tenant. Asking rents for the tower start at $80 per square foot.

The government agency agreed to fully occupy floors eight through 10, as well as partially occupy the seventh floor of the 44-story skyscraper. FDIC will relocate from the Empire State Building, where it occupies roughly 120,000 square feet.

Wells Fargo recently modified the debt on 1166 Avenue of the Americas, extending the maturity dates and altering interest rates on three loans totaling $235 million, according to The Real Deal.

READ ALSO: Office Report: Office Sector Decline Continues Amid Flexibility Shift

The tower debuted in 1975 with design services provided by Skidmore, Owings and Merrill. A partnership of Tishman Organization—the predecessor to Tishman Speyer—Stanley Stahl and Arlen Realty developed the building.

1166 Avenue of the Americas is roughly 3 miles northeast of downtown Manhattan, within walking distance of Bryant Park, Grand Central and the Rockefeller Center. Central Park is more than 1 mile from the property.

The WiredScore Gold-certified skyscraper features 39,075 rentable-square-foot floorplates and recently underwent a revamp that introduced a new conference center and destination-dispatch elevators, among other features. Also in the works are a new gym and lounge.

The tenant roster includes CNA Insurance, which recently inked a 40,240-square-foot deal to occupy the space for 15 years, and Axis Insurance, which occupies 40,240 square feet on the tower’s 17th floor.

The JLL team that represented EJME included Vice Chairmen Paul Glickman and Cynthia Wasserberger, as well as Senior Vice President Diana Biasotti, while the in-house EJME crew comprised Executive Vice President Jeffrey Sussman and Vice President Matt Pynn. Colliers Executive Vice President Connor Faught and Vice Chair Sheena Gohil negotiated on behalf of FDIC.

Manhattan’s office leasing activity takes off

Manhattan’s office market closed 2024 with a bang as new leasing activity in the fourth quarter reached 6.7 million square feet, the highest quarterly total since September 2022, according to a report by Cushman & Wakefield.

The strong quarterly activity rounded up the year with an annual total of new leases clocking in at 23.4 million square feet—outperforming 2023 by 30.2 percent—the same source shows. By adding renewals to the mix, Manhattan’s office leasing activity registered 32.4 million square feet, the highest figure since 2019.

Following four quarters marked by office vacancy increases, Manhattan’s rate inched lower by 20 basis points and stood at 23.3 percent in December, the report reveals. Although the market’s absorption rate wrapped up the year at a negative 6.2 million square feet, the prime office space of Class A assets was in high demand, posting a positive absorption of 372,589 square feet during the fourth quarter.

One of the market’s significant office deals recorded last year was New York University’s agreement to master lease Vornado Realty’s entire 1.1 million-square-foot building at 770 Broadway. The lease was possible as Meta Platforms announced plans to exit the building early this year.

The post Minskoff Secures 148 KSF Manhattan Office Lease appeared first on Commercial Property Executive.

BXP has signed an approximately 246,000-square-foot, 20-year lease renewal and expansion with KnitWell Group at 7 Times Square in New York City. The lease covers the existing roughly 191,000 square feet, plus two additional full floors that total a further 55,000 square feet.

KnitWell COO Patrick Walsh referenced the advantages of bringing all of the company’s New York–based associates into one building, given the need to collaborate across functions and brands. KnitWell’s fashion brands include Ann Taylor, Chico’s, Lane Bryant, Soma and Talbots. Chico’s, Soma and White House Black Market were added only in the past few weeks.

7 Times Square was developed by BXP in the heart of Manhattan’s Midtown and recently underwent an amenities enhancement with conferencing, client lounge and café services added. Its location puts the building in the middle of numerous transportation and dining options, as well as near Bryant Park.

READ ALSO: What’s Defining Office in 2025?

The 47-story, 1.3 million-square-foot, Class A+ property, also known as Times Square Tower, was completed in 2004, according to information provided by CommercialEdge.

A CBRE team led by Vice Chairmen Eric Deutsch and Ken Meyerson, Executive Vice President Jared Freede, Senior Vice President Ariel Ball and First Vice President Elliot Bok represented KnitWell in the lease negotiations.

Forward strides

The Manhattan office market has seen a recent surge of leasing activity, hitting nearly 7 million square feet in the year’s final quarter, which was 41 percent ahead of the five-year quarterly average, according to a fourth-quarter report from CBRE. Full-year leasing for 2024 hit 23.5 million square feet, which was a 24 percent increase over 2023.

And those figures didn’t reflect a situation of “musical buildings,” either. Net absorption for 2024 was nearly 7 million square feet, which in turn helped push the average availability down by 150 basis points from a year prior.

In October, Blue Owl Capital expanded its lease at Manhattan’s Seagram Building, from 168,597 to 238,673 square feet. Cushman & Wakefield represented the tenant, and owner RFR Realty had in-house representation.

The post BXP Lands Major NYC Lease Renewal, Expansion appeared first on Commercial Property Executive.

RXR has bought a 49 percent interest in 1211 Avenue of the Americas, a nearly 2 million-square-foot office tower in New York City. The share was acquired from Ivanhoé Cambridge, the global real estate group of CDPQ.

The 44-story Manhattan skyscraper previously changed hands in 2013, in a deal evaluating the property at $1.7 billion. At that point, Ivanhoé bought a 51 percent stake from Beacon Capital Partners for $850 million. Three years later, Beacon sold its remaining 49 percent to Ivanhoé and Callahan Capital for a slightly higher $895 million.

Ivanhoé Cambridge and RXR, now co-owners, will invest $300 million together to reposition 1211 Avenue of the Americas. The project will feature a revitalized plaza and a redesigned multitenant lobby. The plan includes a new amenity center, conference rooms, a wellness center and other updates.

READ ALSO: What’s Defining Office in 2025?

“There is a prolific impending shortage of high-quality office space in Manhattan,” Lindsay Ornstein, co-founder of OPEN Impact Real Estate, told Commercial Property Executive. “RXR/Ivanhoé Cambridge’s proposed modernization of 1211 Avenue of the Americas will create a welcome addition to the Class A+ marketplace.”

Fox and News Corp. signed lease extensions in 2023 to secure roughly 55 percent of the building through 2042. A law firm is departing in 2028, leaving more than 600,000 square feet of contiguous premium space in a “building within a building” in the Rockefeller Center/Midtown submarket, where the rate of unoccupied space is well below the average of Midtown Manhattan.

The tenant roster also includes the likes of Dow Jones and publications Wall Street Journal and Barron’s, as well as CDPQ and several law firms and financial services companies.

Strategic Capital Alliance and Newmark advised RXR on the transaction.

In October, in a somewhat similar move, RXR’s Office Recovery Fund partnered with Hudson Bay Capital to share ownership of and reposition a historic 500,000-square-foot office and retail building in Manhattan’s Chelsea neighborhood: 620 Avenue of the Americas.

The post RXR Acquires 49% Stake in NYC Skyscraper appeared first on Commercial Property Executive.

Williams Equities has purchased a 300,000-square-foot pre-war office building located at 470 Park Ave. South in Manhattan for $147.5 million, the company announced Monday. The deal continues Williams’ strategy of acquiring what the company describes as “high quality, tastefully restored office buildings with modern amenities,” with a focus on Midtown South.

Among Williams’ other properties in that submarket is 28-40 West 23rd St., which was refinanced for $155 million last April.

Global real estate firm Jamestown is a limited partner on 470 Park Ave. South.

470 Park Avenue South is also known as the Silk Building, for its famous cast-iron clock depicting a wizard calling upon the “Queen of Silk.”

The property consists of two interconnected office building, a 12-story North Tower and an 18-story South Tower Additionally, the property has ground-floor retail and an amenity space with outdoor workspaces, dining and recreational areas. The loft-style asset was recently renovated and rebranded with Energy Star certification, modern finishes and expansive open floor plans.

READ ALSO: What’s Defining Office in 2025?

The location, between 31st and 32nd streets, provides easy access to the Metro-North Railroad, Amtrak, PATH, LIRR and NJ Transit, as well as nearly a dozen subway lines.

Williams Equities Principals Michael Cohen, Andrew Roos and Robert Getreu and General Counsel William Stempel, along with Colliers Vice presidents Jessica Verdi and Mac Roos, assisted with negotiations and underwriting. The sale was brokered by Will Silverman of Eastdil Secured on behalf of the sellers, which were not disclosed.

The acquisition of 470 Park Avenue South completes a strategic portfolio exchange by Williams Equities. The company recently sold 653-655 Madison Ave. and used those proceeds to acquire 470 Park Ave. South.

Slow improvement

Midtown South has an overall availability of 18.0 percent on an inventory of 191.8 million square feet, according to a third-quarter report from Colliers. Net absorption in the submarket was about 1.6 million square feet for the quarter.

Borough-wide, Manhattan is seeing modest quarter-to-quarter increases in leasing volume, with generally positive absorption, albeit at lower pricing. Asking rents are an average of 6.8 percent below those in March 2020, Colliers reported.

The post Williams Equities Buys Pre-War Manhattan Office Building appeared first on Commercial Property Executive.

Jacob Chetrit, one of four brothers who forged a powerful New York City-based investment business, has died at 69. His death was reported by Crain’s New York Business.

The Chetrit Group, founded by Chetrit’s brother Joseph, and which included their brothers Juda and Meyer, has earned a reputation for keeping a low media profile. However, the clan has been involved with some of the highest-profile deals of recent decades.

In 2004, a joint venture of the Chetrit Group, Joseph Moinian and American Landmark paid $841 million for the Sears Tower, the Chicago office property that reigned as the world’s tallest building for a quarter century and is still the third tallest in the U.S. In 2015, Blackstone paid a reported $1.3 billion for the property, which by then had been renamed Willis Tower.

For more than a decade, Jacob and his brother Juda ran the Chetrit Organization, an entity that operated separately from the Chetrit Group but provided some management services to the original company.

The Chetrit Organization’s high-profile holdings have included 850 Third Ave., a 21-story, 600,000-square-foot Manhattan office building that HPS Capital Partners acquired in 2023. The firm also owns 1 Whitehall St., an office tower in Manhattan’s Financial District. Completed in 1962, the 322,000-square-foot property was acquired from Rudin Management in 2019 for $182 million.

As also reported by Crain’s, LoanCore Capital Credit filed a lawsuit in October to assume control of the building on the grounds that the Chetrit Organization hadn’t made a payment on a $156 million mortgage since 2023 or on another office property located at 428 Broadway.

The post Remembering Jacob Chetrit, Influential NYC Investor appeared first on Commercial Property Executive.

• 592 7th Ave., Manhattan

Sale Price: $360 million

Apollo Global Management has acquired a $360 million ownership and equity stake in the 1.1 million-square-foot office building, from RXR Realty. The seller will continue to hold the property as majority owner, in partnership with SL Green. The LEED-certified Times Square asset originally came online in 2000. It rises 38 stories, and features 40,000 square feet of space.

The property last traded in 2016 when RXR Realty paid $1.6 billion for it. At the same time as the sale, the asset became subject to a $1.3 billion loan originated with Corebridge as senior lender. Apollo Global Management became the property’s mezzanine lender in 2022 and decided to convert its position into equity with this deal, becoming part of the ownership.

• 292 Madison Ave., Manhattan

Sale Price: $90.5 million

American Exchange Group acquired the 170,230-square-foot office mid-rise in Murray Hill from Vanbarton Group. The buyer also secured $77.2 million in acquisition financing provided by Deutsche Bank, through a consolidated and restated mortgage agreement. The acquisition follows Vanbarton Group’s default on a $90 million loan secured by the Midtown property. The Art Deco building dates back to 1923, rises 24 stories and features 5,810 square feet of retail space.

• 72-76 Greene St., Manhattan

Sale Price: $90 million

ShopCore Properties has acquired the 45,000-square-foot office building in SoHo from ASB Real Estate. The buyer is one of Blackstone Group’s divisions and the deal was part of a $197 million portfolio transaction, according to PincusCo. The office building last changed hands for $41 million in 2012, when ABS Real Estate picked it up from a private seller. The five-story asset includes three residential units totaling 11,250 square feet and 18,500 square feet of retail space.

• 360 Lexington Ave., Manhattan

Sale Price: $65.5 million

AmTrust Realty Corp. purchased the 238,294-square-foot, 24-story office property from Savanna Fund. The buyer landed a $52.4 million acquisition loan from Allstate Funding Corp. and acquired the property in joint venture with Capstone Equities, TheRealDeal reported. The Murray Hill building features 12,234 square feet of retail space and last changed hands in 2019 for $180 million, with AEW Capital Management as seller.

• 61-63 Crosby St., Manhattan

Sale Price: $54.5 million

The 27,930-square-foot office building was part of Blackstone Group’s portfolio deal in SoHo, made through the company’s ShopCore Properties division. The same ASB Real Estate sold the asset, which dates to 1900. The seller owned the two office properties in partnership with L3 Capital, according to TheRealDeal.

—Posted on December 27, 2024

The post Top 5 NYC Office Building Sales—November 2024 appeared first on Commercial Property Executive.

• 102 Greene St., Manhattan

Sale Price: $46 million

RFR Holding has sold the 10,139-square-foot retail building in Manhattan’s SoHo neighborhood to Japan-based Arkray Inc. The four-story building dates to 1910 and is currently occupied by the luxury brand Cartier, which upgraded the interiors in collaboration with Paris-based architectural firm Studioparisien. The property last changed hands in 2022, when RFR Holding paid $31.5 million. The seller was TA Realty.

• 111 N. 6th St., Brooklyn

Sale Price: $35 million

Empire State Realty Trust purchased the 7,684-square-foot retail building in the borough’s Williamsburg neighborhood from L3 Capital. The property is a three-building, single-story complex that dates back to 1945 and is now part of the new ownership’s collection of prime retail buildings on N. 6th Street. The building also includes a second-floor terrace and will be the future home of Hermès, according to Empire State Realty Trust’s website.

• 72 W. 36th St., Manhattan

Sale Price: $30 million

A private individual working on behalf of George Schwartz estate sold the 16,000-square-foot, three-building retail complex in Koreatown to Houston-based Landry’s Inc. The property originally came online in 1915 and includes a five-story building and a total of 2,760 square feet of office space. It is occupied by Keens Steakhouse, which used it as a longtime location in Midtown Manhattan. The new ownership, Landry’s Inc., is a hospitality brand owned by Tilman Fertitta, the Texas billionaire who owns the Houston Rockets.

• 19-23 St. Marks Place, Manhattan

Sale Price: $27.5 million

UBS Realty Investors has sold the retail property in Manhattan’s East Village neighborhood to Lawrence Movtady’s MOVCAP. The 15,851-square-foot building dates back to 1920 and was the former home of Andy Warhol’s Electric Circus nightclub, that operated between 1967 and 1971. The seven-story structure previously changed hands in 2020 for $35 million, when UBS picked it up from Cape Advisors. The new ownership plans to touch up the asset and to continue to operate the multifamily component of the property, comprising 41 rental units, according to Crain’s New York Business.

• 109 N. 6th St., Brooklyn

Sale Price: $18.9 million

Acadia Realty Trust has purchased the 8,322-square-foot retail property in Williamsburg from MARK Capital. The two-story building came online in 1910 and was last upgraded in 2018. The asset includes 5,522 square feet of retail space, 2,800 square feet of storage area and is currently fully occupied by the apparel company Madewell.

—Posted on December 27, 2024

The post Top 5 NYC Retail Building Sales—November 2024 appeared first on Commercial Property Executive.

On the massive exhibit floors of New York City’s Javits Center, there was plenty of buzz this week about one of retail real estate’s most pressing issues: how to find elbow room for retailers in one of the tightest markets in recent memory.

As retail’s postpandemic rebound continues on multiple fronts, the challenge is to find space that’s not only available, but helps retailers expand strategically, said professionals during ICSC’s annual New York City dealmaking show.

In some respects, one of the biggest challenges is a good one to have. Continuing its rebound, demand is climbing across categories. Overall non-mall occupancy is at 97 percent, a 20-year high.

READ ALSO: Shopping Changed Dramatically. Retail Design Is One Step Ahead.

“The reason there’s not much absorption is because there’s not a lot of available space,” said James Breeze, vice president of global industrial and retail research at CBRE. “We’re coming up to a point where rent growth is going to start to accelerate next year.”

The roster of prospective retailers angling for expansion is varied. A diverse group of foreign companies in apparel, food and beverage and experiential retail is in the mix, reported Barrie Scardina, president of Americas retail services at Cushman & Wakefield.

“Some are well-financed and ready for gateway cities,” she noted. Others are less experienced, and better off starting out in attractive secondary markets, such as Nashville, Tenn., Charleston, S.C., and Naples, Fla.

READ ALSO: Adapting Retail Real Estate to New Consumer Demands

The widespread supply-demand imbalance is prompting retailers to bypass conventional formats. Companies must sometimes be willing to depart from their generic prototypes; if the standard space is 50,000 square feet, then 20,000 square feet available in a good location may be the best choice, said Anjee Solanki, national head of Colliers’ retail services and practice groups.

New options for retail locations

Untraditional retail centers can sometimes be the best places to grow. Some brands that normally set up shop in regional malls or open-air lifestyle centers will find space in neighborhood shopping centers. Show attendees pointed to that trend as a sign of increased willingness to meet customers where they are.

More answers to retail’s space squeeze may emerge from downsizing plans, such as Walgreens’ announced intention to close 1,200 stores over the next three years. Solanki suggested that the sizes of those stores might make some of them attractive to expansion-minded grocers. In March, one such firm, Aldi, announced a five-year plan to open 800 new stores.

Another sign of consumer interest and the strength of brick-and-mortar is the planned return of several recently defunct brands to physical stores, under new ownership and in new formats, noted Kristin Mueller, president of retail property management at JLL. Bed Bath & Beyond, for example, is on track to return to stores in 2025, in spaces showcased by The Container Store.

Competition for space, and the high stakes of expansion, call for an intentional mindset. Those priorities are placing consulting services at a premium. “We’re definitely seeing retailer look to us for how they can continue to grow,” Scardina reported. Decisions about when and where to expand must be highly strategic and draw on sophisticated analytics. As a result, she added, “That advisory work is more important than ever.”

The post ICSC Special Report: Retail’s Big Space Race appeared first on Commercial Property Executive.

Longpoint Partners has acquired The Hills Village Center, a 110,453-square-foot retail center in Bedminster, N.J. The shopping center will be managed under the firm’s Lena Centers brand.

Longpoint paid nearly $50 million for the asset, according to Commercial Real Estate Direct. JLL represented the seller and procured the buyer.

Completed in 1988 on a 13-acre site, The Hills Village Center was 89.3 percent leased at the time of sale. The property is anchored by Kings Food Market and its tenant roster includes CVS, Cold Stone Creamery, PNC Bank, Starbucks, Great Clips and Orange Theory.

The retail center is at 550 Hills Drive within The Hills, a townhouse community of 5,548 households. Major transportation routes in the area include interstates 287 and 78, as well as highways 202 and 206. The retail center has more than 380,000 annual visits.

JLL Senior Managing Directors Jose Cruz and Kevin O’Hearn, together with Director J.B. Bruno, led the Capital Market Investment and Sales Advisory team representing the seller.

As for the buyer, Longpoint purchased another retail asset, in Phoenix, earlier this month. The 101,269-square-foot shopping center also operates under the Lena Centers brand.

The post Longpoint Buys New Jersey Retail Center for $50M appeared first on Commercial Property Executive.

SL Green Realty Corp. has signed a purchase option agreement to acquire its partner’s 49.9 percent interest in 100 Park Ave., an 834,000-square-foot Manhattan high-rise. PGIM Real Estate acquired the asset in a venture with SL Green in 2000.

Additionally, the company also modified the building’s existing $360 million mortgage, extending the final maturity date to December 2027 and maintaining the 2.25 percent interest rate. The lenders also provided a new $70.0 million future funding facility to support leasing costs at the property. Newmark advised the borrower, while CBRE worked on behalf of the loan providers.

Although the lenders were not mentioned, a syndicate led by German commercial bank Helaba provided a $360 million loan in February 2014, according to The Real Deal, and a $215 million refinancing in 2009.

READ ALSO: Manhattan Office Shows Strength in a Still Lackluster Market

The company previously closed on the modification of the loan in April. At the time, the deal extended the note’s maturity date to December 2025, while the interest rate was maintained at 2.36 percent.

The 36-story property came online in 1949 and was redeveloped in 2009. The high-rise holds LEED Gold certification and features floorplates ranging between 10,336 and 45,245 square feet, as well as 21,600 square feet of first-floor retail space.

Amenities at the Midtown Manhattan tower include a game room, a cafe bar and lounges, as well as conference and meeting rooms. The property also has an amenity center on the second floor, providing a golf simulator and personal training studio.

Newmark Co-Heads Adam Spies and Doug Harmon advised SL Green in the deal. CBRE Vice Chairman Doug Middleton worked on behalf of the lenders.

Busy period for SL Green

At the beginning of this month, SL Green and its joint venture partners closed on a $1.3 billion mortgage modification and extension for One Madison Avenue, a fully renovated 27-story office building in Manhattan. The note’s maturity date was extended through November 2027.

In November, the firm sold an 11 percent ownership interest in One Vanderbilt, a 1.7 million-square-foot high-rise also in Manhattan. Mori Building Co. purchased the stake in a deal that valued the asset at $4.7 billion.

The post SL Green to Buy Out PGIM at Manhattan High-Rise appeared first on Commercial Property Executive.

This transaction reportedly bumps SL Green’s office leases executed so far this year to more than 3.5 million square feet, with a pipeline of more than 900,000 square feet.

485 Lexington Ave., also known as Grand Central Square, totals 904,165 rentable square feet of office space across 32 stories and dates to 1957, though it’s nonetheless still a Class A building, according to CommercialEdge. It has an overall vacancy of about 13 percent.

Travelers Insurance was represented by Robert Ageloff, Matt Astrachan and Kate Roush of JLL, and SL Green was represented by Paul Glickman, Alex Chudnoff, Diana Biasotti, Christine Colley and Kristen Morgan, also of JLL.

SL Green is the largest office landlord in Manhattan and holds ownership interests in more than 28 million square feet of Manhattan buildings.

Big money on the hunt

The lease announcement closely followed the news that a major Canadian pension fund, reportedly Caisse de Dépôt et Placement du Québec, has committed $250 million for a new SL Green opportunistic debt vehicle.

The fund, for which SL Green hopes to raise a further $250 million by year’s end, is said to focus on distressed credit opportunities in New York office and retail real estate, including existing loans, loan portfolios and controlling CMBS securities. The fund will also originate loans.

Manhattan’s office market saw 5.47 million square feet of leasing activity in the third quarter, which was 8 percent above the five-year quarterly average, according to a report from CBRE. In turn, overall availability declined by 50 basis points year-over-year, to 19.3 percent.

The post SL Green Lands Major Lease Renewal appeared first on Commercial Property Executive.

The fund will focus on distressed credit opportunities in New York’s office and retail real estate sectors, including existing loans, loan portfolios and controlling CMBS securities. It will also originate loans.

The $250 million commitment is just the beginning, since SL Green plans to raise roughly another $250 million by the end of this year. New York offers a robust pipeline of investment opportunities, according to a company statement.

“After nearly a four-year hiatus, we are now… lending on and investing in mortgage and mezz loans and debt securities,” SL Green Chairman & CEO Marc Holliday said during the company’s most recent earnings call in October. 

“This quarter, we invested nearly $110 million in various debt and debt-like investments, and that’s on top of the other DPE investment activity we did earlier this year,” Holliday said. “This marks the return to an extremely profitable business.”

The debt investments closed thus far combined with the pipeline that the company has been building throughout 2024 will serve to seed the debt fund, Holliday said.

“The fund will provide additional capital resources enabling us to reestablish ourselves as the dominant provider of subordinate capital for New York City commercial assets,” he predicted.

READ ALSO: Why Aren’t Mortgage Rates Dropping After the Fed Rate Cut?

A major commercial landlord in New York, SL Green holds an interest in 55 buildings totaling 31.8 million square feet. That includes interests in 28.1 million square feet of Manhattan buildings and 2.8 million square feet securing debt and preferred equity investments.

CDPQ, based in Montreal, has about $452 billion in assets under management, including $45.6 billion in real estate in more than 1,500 properties.

Manhattan office market still struggles

The Manhattan office market continues to suffer from weak demand. The number of office-using jobs in the market dropped 0.53 percent year-over-year in September, according to CommercialEdge, losing positions in all major categories: financial services, information and professional and business services.

Asking rents in Manhattan decreased by 3.2 percent year-over-year in November, averaging $68.48 per square foot, CommercialEdge reports. For the first time in years, Manhattan wasn’t the most expensive office market in the country. San Francisco now has that distinction, besting Manhattan by 66 cents per square foot.

Investors are still interested, however. Manhattan continues to lead the nation in office asset sales volume, reaching almost $3.3 billion year-to-date through October, CommercialEdge noted.

This is nearly double Manhattan’s $1.7 billion recorded during the same period last year, though average sale prices in the market have dropped in recent months, to $344 per square foot, putting Manhattan fourth for sale prices among U.S. office markets.

The post SL Green Bags $250M for Opportunistic Debt Fund appeared first on Commercial Property Executive.

Andrew Glanzman and Adam Gallistel have been named co-CEOs of CBRE Investment Management.

The appointments come after nearly two years during which CBRE IM operated without a CEO. Charles Leitner, the last to hold the position, retired at the end of 2022.

Glanzman’s promotion is effective immediately. He joined CBRE IM in 2010, and has served as the firm’s president since 2022. Previously, he was the chief operating officer. He will remain president in his new tenure, and will oversee the firm’s larger business strategy and day-to-day operations. He currently works out of the firm’s Los Angeles office and will move to its New York City global headquarters in 2025. Previously, he was an attorney at Mayer Brown LLP, and did work in corporate securities transactions.

Gallistel, the head of Americas real estate and global real estate credit at Singapore-based GIC, will assume his new role in April 2025. In addition to working alongside Glanzman, Gallistel will also become chief investment officer, directing the firm’s strategies across commercial real estate and heading up investor engagement. According to CBRE, Gallistel’s focuses will include data centers and asset classes that intersect directly with infrastructure investments.

In their new roles, both Gallistel and Glanzman will oversee the firm’s executive committee.

READ ALSO: How Infrastructure Investment Drives Industrial Space Growth

Kim Hourihan, the firm’s current global chief investment officer, will remain in her role through the end of March of next year, departing at the end of June.

CBRE IM ranked first in CPE’s latest survey of top investors, with a portfolio valued at $109 billion.

Synergistic skillsets

Glanzman praised the new leadership structure in an interview with Commercial Property Executive, seeing the differing, yet “complementary” backgrounds between him and Gallistel as uniquely suited to the current investment environment.

“I have experience in big strategy and building businesses, while (Gallistel), as an LP, embodies the client-centric approach that we have today,” Glanzman said. “We bring different, yet very complementary skill sets to create something that’s quite powerful.”

Going into 2025, Glanzman is optimistic about where commercial real estate investments will go, following a year of slumped property valuations and low transaction volumes. “We are increasingly optimistic about opportunities in the market in terms of where we see values going for properties in terms of transactions, trading and transparency, and we are having a number of positive conversations with investors who are becoming more active again,” he added.

The post CBRE Investment Management Names Co-CEOs appeared first on Commercial Property Executive.

The firms extended the final maturity date through November 2027, maintaining the interest rate at 3.10 percent over term SOFR, with a further reduction in spread when specific leasing thresholds are exceeded. Wells Fargo Bank led the facility of 14 global banks.

Designed by renowned architect Kohn Pedersen Fox, One Madison Avenue embraces the new standard for the modern work experience, using an ambitious adaptive reuse project. Its tower floors and retail spaces are 100 percent leased, and the property is more than 65 percent leased overall.

Tenants include Franklin Templeton, Coinbase, Palo Alto Networks and IBM, which moved into its new corporate headquarters in September. Additional tenants will be moving in throughout 2025.

READ ALSO: Law Firm Office Leasing Maintains Momentum

They take advantage of a property that emphasizes wellness by providing an HVAC system that circulates 100 percent fresh air, expansive floor-to-ceiling windows with heavy doses of natural light and nearly column-free spaces that maximize workspace efficiency.

Lenders understand the asset’s value

“Manhattan’s leading office properties continue to draw companies that value the local work ethic and culture,” Lisa Flicker, senior managing partner ‑ head of real estate, Jackson Lucas, told Commercial Property Executive.

“Teams based in the city work longer hours with greater intensity, contributing to a unique drive that’s hard to replicate elsewhere,” Flicker said. “While relocating teams may enhance quality of life, it often diminishes productivity and tenacity, creating a trade-off. I wouldn’t bet against premium assets in NYC—as it remains the hub where ambitious talent and top-tier workplaces converge for success.”

The transaction proves that the lenders understand the underlying asset’s value, according to David Curry, Farrell Fritz, P.C.

He told CPE that the “return to the office” movement is happening slowly, and this type of Class A space “with world-renowned landlords such as SL Green” is leading the way.

“It is encouraging to see lenders making deals that make sense with borrowers who have shown them a history of living up to their promises,” Curry said. “Hopefully, deals such as this will encourage borrowers and lenders to return to the table to ink longer-term deals.”

He said the issue remains: What about the Class B and Class C office space?

“These owners—and the lenders that have provided financing to them—are in for a tougher road, as values have declined, and rates are at their highest in several years.”

According to Curry, these buildings need to be upgraded to include some of the features that Class A buildings have, making them more attractive, which further hinders sensible financing deals.

Last month, SL Green Realty sold an 11 percent ownership interest in One Vanderbilt, its 1.7 million-square-foot Manhattan skyscraper. SL Green will continue to own a 60 percent stake in the 59-story tower that was fully leased at closing.

The post SL Green Secures $1.3B Mortgage Extension for NYC Tower appeared first on Commercial Property Executive.

Metropolitan Commercial Bank has renewed and expanded its office space at 99 Park Ave., a 600,000-square-foot Manhattan office tower. The company will bring its footprint at the Global Holdings-owned property to some 81,979 square feet.

The anchor tenant signed a six-year lease extension on its current 52,677-square-foot office space covering the building’s 12th and 13th floors. In addition, the bank leased the entire 11th floor with a new 15-year commitment for 26,802 square feet.

JLL Vice Chairman Paul Glickman and Senior Vice President Diana Biasotti worked on behalf of the tenant, while JLL Associate Vice President Kristen Morgan and Associate Harrison Potter represented the landlord.

Manhattan tower slated for renovation

Global Holdings acquired the office tower in 1990 for $104.5 million, according to CommercialEdge information. The property came online in 1953 and underwent cosmetic renovations in 2005.

Designed by Emery Roth & Sons with Art Deco interiors, the 26-story building has floorplates averaging 30,000 square feet, 12,000 square feet of retail space and a tenant-exclusive fitness center. Its roster includes Calypso Technology, Windsor Properties, Bosley, Gould Paper Corp., New York Bankers Association, AKAM, Lubert-Adler and Steward Partners, among others.

READ ALSO: Return-to-Office Traffic Reaches Record Level

The owner plans to invest $30 million to renovate the Class A tower. Designed by VOCON, the improvements will focus on the lobby, facade and amenity spaces. Plans call for a new conference center, entertainment lounge and tenant barber shop and salon. Completion is expected in the first quarter of 2026.

The property is in Midtown Manhattan, half-a-mile from the Empire State Building, Grand Central Terminal and Bryant Park.

Manhattan’s office market had a 16.7 percent vacancy rate in October, down 80 basis points over the year, according to a recent CommercialEdge report. The index was also 270 basis points below the national average of 19.4 percent.

The post Metropolitan Commercial Bank Renews, Expands Manhattan Lease appeared first on Commercial Property Executive.

SL Green Realty Corp., Manhattan’s largest office landlord, is expanding its Park Avenue portfolio with the purchase of the office portion of 500 Park Ave. Morgan Stanley sold the 11-story, 201,000-square-foot Class A mid-rise for $130 million.

The REIT bought the office component of the building that also has 19,911 square feet of retail. However, the retail portion of the property at the corner of 59th Street in the Plaza District was not part of the deal, nor were its 56 residential condominium units.

Newmark’s Adam Spies, Doug Harmon, Adam Doneger, Joshua King and Marcella Fasulo advised on the transaction.

Building, market highlights

SL Green plans to reposition the lobby, add building amenities and make substantial improvements to the public plaza.

Morgan Stanley has owned the building since April 1980, having acquired it from HJ Kalikow Co., according to CommercialEdge data. The property is subject to a 99-year unsubordinated net ground lease, which is held by Kalikow Holdings and expires in March 2079.

Completed in 1959, it has been institutionally owned and maintained since its construction as the former PepsiCo Inc. headquarters. The historic, landmarked property was designed by Skidmore, Owings & Merrill. Floorplates in the glass and masonry building range from 14,800 to 19,684 square feet, according to CommercialEdge.

The building had a cosmetic renovation in 1984. Its last renovation was in 2019, The Real Deal reported.

READ ALSO: Manhattan Office Shows Strength in a Still Lackluster Market

SL Green’s other Park Avenue properties include 100 Park Ave., 125 Park Ave., 245 Park Ave., 280 Park Ave. and 450 Park Ave. The REIT also owns 215 Park Ave. South and 304 Park Ave. South. Last year, an affiliate of Mori Trust Co. purchased a 49.9 percent stake in 245 Park Ave., a 1.8 million-square-foot tower.

Park Avenue is the best office market in New York City with historic low vacancy, according to SL Green, and 500 Park Ave. is set to benefit from opportunities in the fortress corner that attracts top tier tenants and triple-digit rents.

Building tenants include Vera Wang leasing 26,708 square feet for office space and a showroom; The Georgetown Co., 18,795 square feet; CI Capital Partners, 19,158 square feet; PPC Enterprises, 18,683 square feet, and Friedland Properties, CommercialEdge data indicates. The property’s retail space features high-end furniture store FRATO’s flagship New York City showroom.

SL Green moves

The acquisition announcement comes days after SL Green sold an 11 percent ownership stake in One Vanderbilt, its 1.7 million-square-foot skyscraper in Midtown Manhattan, to Mori Building Co. in a deal that valued the tower at $4.7 billion. SL Green will continue to own a 60 percent stake in the 59-story tower that was fully leased at the time of closing. The National Pension Service of Korea owns a 27.6 percent stake and Hines owns 1.4 percent. The LEED Platinum-certified building came online in 2020.

Last month, Bloomberg LP signed a renewal and expansion lease at another SL Green Midtown Manhattan tower—919 Third Ave. Bloomberg’s latest deal brings its footprint at the 1.5 million-square-foot, 47-story office high-rise to 924,976 square feet.

The post SL Green, Morgan Stanley Strike $130M Deal appeared first on Commercial Property Executive.

Brookfield Properties has tapped JLL as the exclusive leasing agent for Manhattan West’s office component, which spans 6 million square feet.

Chairman & President Peter Riguardi, Vice Chairs Paul Glickman and Matt Astrachan, Executive Managing Director Christine Colley and Senior Vice President Kristen Morgan, along with Vice President Seth Godnick, will lead the JLL team. The brokers will work alongside the property operator’s in-house team.

Manhattan West is a 7 million-square-foot, mixed-use campus comprising four office towers and an 844-luxury residential high-rise dubbed The Eugene, as well as a 164-key boutique hotel. Additionally, the live-work-play property has more than 240,000 square feet of retail space and is anchored by a 2.4-acre landscaped public plaza.

Manhattan West’s office component, up close

One of the buildings within the campus is One Manhattan West, totaling about 2.1 million square feet and rising 67 stories. Completed in 2019, the LEED Silver-certified skyscraper has tenants such as Skadden, NHL, Ernst & Young and Accenture on its roster.

Two Manhattan West came online last year and spans 1.9 million square feet across 58 stories. The tenant roster includes Cravath, KPMG, D. E. Shaw & Co. and Clifford Chance.

READ ALSO: Manhattan Office Shows Strength in a Still Lackluster Market

The 201,695-square-foot Lofts at Manhattan West is a 1913-completed building that rises 14 stories. Initially, the property was designed for industrial use, but was converted to office in 2002, according to CommercialEdge information. Brookfield acquired it in two interest-stake deals from Planned Parenthood for a combined $135.5 million.

Completing the mixed-use campus is Five Manhattan West, a 1.8 million-square-foot mid-rise that came online in 1969. The 16-story building was completely renovated in 2016 and 2024, the same source shows. The owner purchased it in September 2011 from Lone Star Fund.

All buildings are powered by renewable electricity sourced from run-of-river hydropower dams, contributing to a more than 80 percent reduction in direct carbon emissions.

Located at 401 & 389 Ninth Ave. and 424 & 450 West 33rd St., the properties have direct connectivity to Moynihan Train Hall and Penn Station. Numerous subway and train stations are also nearby.

Manhattan’s office vacancy rate drops

Manhattan’s office vacancy rate at the end of October clocked in at 16.7 percent, registering an 80-basis-point decrease year-over-year, according to a recent CommercialEdge office report. The borough’s figure was well below the 19.4 percent national average, with return-to-office policies helping the sector. Despite a shrinkage in lease sizes, leasing activity was on par with pre-pandemic levels.

At the beginning of the year, Vornado Realty Trust appointed Cushman & Wakefield as exclusive leasing agent for PENN 2, a Class A, 1.8 million-square-foot high-rise in Midtown Manhattan. That office building was completely redeveloped last year.

The post Brookfield Taps JLL for Big NYC Office Leasing Job appeared first on Commercial Property Executive.

Steiner NYC has landed $148.5 million for the refinancing of Admirals Row, a 696,000-square-foot, mixed-use property part of Brooklyn Navy Yard. Deutsche Bank provided the note in a transaction arranged by Walker & Dunlop.

Previous debt included a $228 million construction loan issued by M&T Bank and BNY Mellon in 2018, as well as a $50 million loan originated by the New York City Regional Center.

Admiral Row encompasses more than 350,000 square feet of light industrial and creative manufacturing space leased by the Brooklyn Navy Yard Development Corp., as well as 160,000 square feet of retail including the 75,000-square-foot space leased by Wegmans—the company’s first supermarket in New York City.

In addition, the 8-acre property comprises a 5,000-square-foot community facility and a parking structure and lot with 701 spaces combined.

READ ALSO: Why Aren’t Mortgage Rates Dropping After the Fed Rate Cut

Located at 399 Sands St., Admiral Row is within 1 mile from Interstate 278—also known as the Brooklyn-Queens Expressway—as well as the Manhattan and Brooklyn bridges. Steiner Studios, a film and television production facility encompassing 900,000 square feet of soundstages and support space, is likewise 1 mile away.

The Walker & Dunlop team that represented and advised Steiner NYC in securing the financing included Senior Managing Directors Jonathan Schwartz, Aaron Appel, Keith Kurland and Adam Schwartz, together with Managing Director Michael Diaz and Capital Markets Specialist William Herring.

Overhauling New York City’s largest industrial campus

Admirals Row is part of the $2.5 billion Brooklyn Navy Yard redevelopment project. Plans call for the creation of 5.1 million square feet of manufacturing space, as well as the improvement of the Yard’s connectivity with the surrounding neighborhoods. More than 450 businesses operate within the Yard, generating upward of $2 billion annually for the city.

The Admirals Row site formerly housed the officers of the Navy Yard throughout buildings constructed before the 1900s. However, the Yard closed in 1966, and the residences were abandoned in the 1970s. Decades later, the site changed hands and the Brooklyn Navy Yard Development Corp. took ownership.

Financing development in the Big Apple

Several entities support development throughout the five boroughs. One of them is The New York City Regional Center. 

The NYCRC has provided nearly $1.6 billion in financing over the past 15 years for real estate and infrastructure projects throughout Brooklyn, Queens, Manhattan and the Bronx. Beside financing Steiner’s Admirals Row, the company also funded the Navy Yard redevelopment’s first phase with a $60 million loan.

New York City outer boroughs’ new industrial leasing activity clocked in at 2.2 million square feet during the first three quarters, representing an 18.7 percent spike year-over-year, according to a report by Cushman & Wakefield.

Despite the heightened activity, the industrial vacancy rate stood at 5.1 percent in September—marking an 80-basis-point increase compared to June—the report shows. The index hasn’t been over the 5 percent mark since 2020.  

The post Steiner Lands $149M for Brooklyn Navy Yard Property appeared first on Commercial Property Executive.

• 92 Greene St., Manhattan

Sale Price: $43.4 million

Acadia Realty Trust picked up three retail condominium units totaling 7,906 square feet in Soho from Continental Ventures. The deal includes two units at 92 Greene St. of 2,936 square feet and 2,569 square feet, respectively, along with a 2,401-square-foot unit at 109 Mercer St . The retail assets are part of a 2005-built mixed-use building rising seven stories and spanning 51,065 square feet.

• 141 Berry St., Brooklyn

Sale Price: $35 million

One day later, the same firm acquired 11,250 square feet of retail space spread across three buildings in Brooklyn’s Williamsburg area from M&V Provisions Co. Located at 141 Berry St. and between 123 and 125 N. 6th St., the deal includes two properties occupied by Partners Coffee Café & Roastery and Lululemon, in addition to a vacant building. The three-story structures were originally completed in 1985 and include two residential units.

• 102 N. 6th St., Brooklyn

Sale Price: $28.6 million

In the same Williamsburg area, Empire State Realty Trust bought a 16,924-square-foot, two-story building from L3 Capital. The retail property originally came online in 1962, was renovated in 2001 and features 5,990 square feet of office space alongside 4,502 square feet of storage space. The properties last traded for $49 million in 2013 when RedSky Capital sold them to L3 Capital.

• 134 N 6th St., Brooklyn

Sale Price: $28.3 million

Two days earlier, Empire State Realty Trust acquired another retail property on the same street in the borough’s Williamsburg area, from the same seller, L3 Capital. The 6,232-square-foot single-story building came online in 1950 and is home to a fragrance, beauty and eyewear boutique by Chanel.

• 124 N. 6th St., Brooklyn

Sale Price: $18.1 million

The same entities made another deal on the same street, involving a 1910-built, 2,510-square-foot retail property. The acquisition is part of Empire State Realty Trusts’s $195 million portfolio deal on the borough’s North 6th Street, according to The Real Deal. The one-story retail asset was renovated in 2019 and is now available for lease, as it is included in the REIT’s North Sixth Street Collection, a portfolio of prime retail buildings, according to the company’s website.

The post Top 5 NYC Retail Building Sales—October 2024 appeared first on Commercial Property Executive.

The Malin is planning to open a 32,700-square-foot coworking space in Manhattan’s Flatiron District in the spring of 2025.

The new coworking venue will be within the Equinox building at 895 Broadway, occupying the fourth and fifth floors. The five-story property features a total of 57,050 square feet, according to CommercialEdge information. The Equinox Flatiron fitness club occupies the building’s first three levels.

The Malin Flatiron will feature a 2,700-square-foot mezzanine floor, 20 private offices, 36 dedicated desks, five meeting rooms, 23 phone booths, one library and two kitchens.

Originally completed in 1915, with cosmetic renovations in 1983 and 1993, the historic building last traded in 1996 for $5.8 million. Since 2014, it has been the subject of a 15-year, $65 million loan originated by Sammons Financial Group.

With street exposure on Broadway, the property is within minutes of Madison Square Park, the Flatiron Building and the subway station on 23rd Street. Areas with dense concentration of office buildings, such as Grand Central District, Times Square and Rockefeller Center, are within 3 miles of the property.

The Flatiron District lease marks the company’s fifth coworking location in New York City. The company’s other four venues are in Soho at 32 Mercer St., in West Village at 134 Charles St., in Williamsburg at 109 N. 12th St., while its latest venue The Malin NoMad, opened in partnership with TF Cornerstone, is at 387 Park Ave. S.

The Williamsburg and West Village locations opened simultaneously in 2022, each with 10,000 square feet of flex office spaces. The NoMad space, which opened in March this year, occupies 20,000 square feet across an entire floor.

The post The Malin to Open Midtown Manhattan Coworking Space appeared first on Commercial Property Executive.

TF Cornerstone has signed a 21,000-square-foot, 10-year extension and renewal with Criteo at 387 Park Ave. S. in Manhattan’s Flatiron District. Cushman & Wakefield worked on behalf of the landlord.

The commerce media company has been a tenant at the 232,000-square-foot office building since 2015, CommercialEdge data shows. Criteo occupies the top floor and the penthouse of the property, using this space as its North American headquarters. The renewed commitment occurred when the 13-story property reaching full occupancy.

Other tenants at 387 Park Ave. S. includes eRealty Advisors, The Corcoran Group, Optimus Marketing Inc., Coachieve and Third Republic, according to the same source. Last month, The Malin opened its new flex office location at the property, with a 20,000-square-foot commitment on the fifth floor. Additionally, the landlord has also expanded its own footprint here with an additional 7,000 square feet of space, now occupying a total of 59,000 square feet.

TF Cornerstone’s ownership of 387 Park Ave. S.

TF Cornerstone picked up the property in 2005 for nearly $68 million, according to CommercialEdge, later becoming subject to a $100 million loan held by Equitable Insurance Co., with a maturity date set for 2030. The 1910-built office mid-rise features 19,372-square-foot floorplates, 14,899 square feet of first-floor retail space, six passenger elevators and an on-site conference center.

The company renovated 387 Park Ave. S. between 2015 and 2017, with a more than $20 million investment. The property now includes an upgraded lobby, a glass façade on the lower three floors, new elevators and a roof deck amenity space wit a 1,700-square-foot conference room.

Situated between Union Square and Grand Central Terminal, 387 Park Ave. S. is 4 miles from the Upper West Side, 5 miles from the Financial District and within 18 miles of John F. Kennedy International Airport.

The landlord was represented by Chairman of Global Brokerage Bruce Mosler, Managing Director John Fitzsimons and Executive Vice Chairmen Ethan Silverstein and Mark Mandell with Cushman & Wakefield.

Notable deals in pricy Manhattan

As of September, Manhattan’s office vacancy reached 16.8 percent, marking a 90-basis-point year-over-year drop, while also being below the national rate 19.5 percent, a recent office market update shows. The borough remains the priciest market for office leasing, with asking rents averaging $67.93 per square foot, more than double the national listing rate of $32.89 per square foot.

Recent deals in the metro include SL Green Realty Corp.’s 72,515-square-foot lease at 245 Park Ave. Cushman & Wakefield represented the landlord in the 10-year lease signing with tenant Verition Group NY Inc.

Another significant commitment was a 53,779-square-foot expansion at the Empire State Building. Savills represented the tenant, law firm Hecker Fink LLP, that expanded its footprint at the 102-story skyscraper.

The post TF Cornerstone Inks Long-Term Renewal in Manhattan appeared first on Commercial Property Executive.

SL Green Realty Corp. has sold an 11 percent ownership interest in One Vanderbilt, its 1.7 million-square-foot skyscraper in Manhattan. Mori Building Co. acquired the stake in a deal that valued the property at $4.7 billion.

SL Green will continue to own a 60 percent stake in the 59-story tower that was fully leased at the time of closing. The National Pension Service of Korea owns a 27.6 percent interest in the property, while Hines owns 1.4 percent, according to The Real Deal.

Last year, an affiliate of Mori Trust Co. purchased a 49.9 percent stake in SL Green’s 245 Park Ave., a 1.8 million-square-foot tower less than a mile from One Vanderbilt. That transaction valued the asset at $2 billion.

READ ALSO: Manhattan Office Shows Strength in a Still Lackluster Market

Designed by Kohn Pedersen Fox Associates, the high-rise came online in 2020 in Midtown Manhattan. In June 2021, the developer took out a $3 billion permanent CMBS loan from Wilmington Trust and originated by Wells Fargo Bank, according to CommercialEdge information.

The LEED Platinum-certified building features 35,846-square-foot floorplates, 187,000 square feet of retail space, the SUMMIT One Vanderbilt observation deck, a 30,000-square-foot amenity floor with a 140-seat auditorium and a 30-seat boardroom, social spaces and an expansive outdoor terrace. The skyscraper also has multiple dining options.

The transit-oriented tower rising at 1 Vanderbilt Ave. is also close to the Rockefeller Center and less than a mile from the Empire State Building.

Manhattan’s office sector shows signs of improvement

Manhattan’s office investment volume in the first 10 months of the year totaled nearly $3.3 billion, leading nationally, according to a recent CommercialEdge office report. The price per square foot averaged $344, almost twice the national average of $177. Additionally, the borough’s vacancy rate in October clocked in at 16.7 percent, below the 19.4 percent national index.

The market is showing metric improvements, especially in vacancy rate drops and steady investment volume. Earlier this week, Savanna bought 799 Broadway, a 176,588-square-foot office building for $255 million. Columbia Property Trust and Cannon Hill Capital Partners sold the asset for about $1,444 per square foot.

In September, Bushburg entered the market with the purchase of 110 Maiden Lane, a 38-story, 1.1 million-square-foot tower in the borough’s Financial District. Rudin sold the property for $160 million.

The post SL Green Sells Stake in Manhattan Skyscraper appeared first on Commercial Property Executive.

Savanna has purchased 799 Broadway, a 176,588-square-foot office property in Manhattan, for $255 million—about $1,444 per square foot. Columbia Property Trust and Cannon Hill Capital Partners sold the asset. Eastdil Secured brokered the deal.

The buyer acquired the distressed office property at a discounted price through a lender-controlled sale process administered by Blackstone. In 2022, Blackstone provided $270 million to refinance the mid-rise, according to The Real Deal.

The 12-story building came online in 2022 on the former site of an 1873-completed hotel that was converted to office space in 1940.

A partnership between Ares Management and Normandy Real Estate Partners bought the building in 2016 for $101 million, New York YIMBY reported. In January 2020, Columbia Property Trust acquired Normandy Real Estate Partners, assuming the ownership of the company’s assets, CommercialEdge data shows.

READ ALSO: Manhattan Office Shows Strength in a Still Lackluster Market

At the time of sale, the LEED Gold-certified property was 71 percent leased with an 11-year weighted average lease term. The tenant roster includes Bain Capital Ventures, NewRez and Wellington Management, according to the same source.

Designed by Perkins + Will, the building features private terraces, tenant lounge and ample outdoor space. Located within the Greenwich Village neighborhood of Lower Manhattan, the mid-rise also has more than 23,000 square feet of retail space and a fitness center.

Eastdil Secured Managing Directors Will Silverman and Gary Phillips led the team that brokered the transaction on behalf of the buyer and seller.

Manhattan office sales volume still leads nationally

Manhattan’s office investment volume year-to-date through October reached almost $3.3 billion, according to the latest CommercialEdge office report. Assets in the market traded for $344 per square foot on average, almost double the $177 national figure.

Following a significant period of a depressed market, some of Manhattan’s office metrics are showing improvement, such as a drop in vacancy and steady transaction activity. Still, buildings are trading at significantly lower prices.

In one of the largest transactions this year so far, RFR Realty sold 980 Madison Ave., a 118,635-square-foot asset, for $560 million after defaulting on its $197.6 million CMBS loan. The property changed hands for roughly $4,717 per square foot.

The post Savanna Pays $255M for Manhattan Office Asset appeared first on Commercial Property Executive.

The Manhattan office market is still struggling with new development activity, with only one project breaking ground year-to-date through September, while five other projects were delivered. Still, Manhattan’s investment activity put the metro in the leading spot for total sales volume and average sale price per square foot, according to CommercialEdge data, despite the rise of discount purchases and all-cash deals.

Manhattan’s office sector showed a slight improvement in vacancy, with a number of significant leases inked as of September and the average rate down 90 basis points year-over-year indicating some signs of health.

Large completions and a steady pipeline

In September, Manhattan had 2.6 million square feet of office space under construction, accounting for 0.6 percent of existing stock—below the 1.0 percent national figure. The metro outperformed Washington, D.C. (0.5 percent) and Chicago (0.3 percent), while Boston led the rankings with 4.6 percent. When adding projects in planning stages to that figure, the borough’s share reached 2.4 percent of existing stock.

The largest development currently underway remains 270 Park Ave., the 2.5 million-square-foot Class A+ high-rise developed by JPMorgan Chase. Reaching 1,388 feet, the company’s new global headquarters is expected to come online in 2025.

Another notable project is L&L Holding Co., Columbia Property Trust and Cannon Hill’s Terminal Warehouse Redevelopment. The 1891-built industrial facility is being converted into a 1.3 million-square-foot office and retail space scheduled to be delivered in 2025.

Development continued in line with the current national trends, with a single 51,530-square-foot office building breaking ground in the borough, while developers delivered 3.1 million square feet of office space across five properties.

Office-to-residential conversions are a boost

Office-to-residential conversions remain a focal point for investors in the sector. According to CommercialEdge’s Conversion Feasibility Index, Manhattan’s office stock has 53.1 percent of its office stock in Tiers I and II by conversion potential. This makes the borough the leading market for office-to-residential repurposing potential in the country.

Developers are already working on such projects, with Silverstein Properties’ 55 Broad redevelopment now open. The company teamed up with Metro Lofts on the conversion of a 36-story office building, which resulted in the addition of 571 high-end residential units to the borough’s rental stock. The property had a CFI score of 92, indicating high conversion potential, CommercialEdge data shows.

Elsewhere, a major office-to-residential project is lined up for the building that housed the Archdiocese of New York. The Vanbarton Group is the new owner of 1011 First Ave., in Midtown Manhattan, that is slated to become a rental property, pending approval. The office asset has a CFI score of 95, indicating an even more elevated conversion potential.

Manhattan office investments accelerate

Year-to-date through September, investors in Manhattan traded a total of $2.7 billion across 32 office properties. The sales volume marks a 103.3 percent increase compared to the same interval in 2023. The borough kept its leading spot among the best-performing markets in the U.S. for investment volume, with Washington, D.C., and the Bay Area following, with $2.3 billion and $1.7 billion, respectively.

The average sale price per square foot reached $379 in September, more than double the national average of $167 per square foot. When compared to other gateway markets, Manhattan was the priciest, followed by Los Angeles ($320 per square foot), the Bay Area ($279), San Francisco ($267) and Washington, D.C. ($235).

One major deal was the $560 million sale of 980 Madison Ave. Bloomberg Philanthropies purchased the five-story, 118,635-square-foot office building on the Upper East Side. RFR Realty sold the asset after having defaulted on its $197.6 million CMBS loan.

Another notable transaction was the $320.2 million sale of 250 Park Ave., a 543,292-square-foot office property in Manhattan’s Plaza District. JPMorgan Asset Management bought the 21-story building from AEW Capital Management, which had owned the property since 1998.

Vacancy sees some improvement

As of September, Manhattan’s office vacancy rate reached 16.8 percent, down 90 basis points over a 12-month period and below the national rate of 19.5 percent. Only Boston (16.4 percent) and Los Angeles (16.3 percent) performed better than Manhattan, while even larger office vacancies were recorded in Washington, D.C. (17.7 percent), the Bay Area (25.3 percent) and San Francisco (27.6 percent).

Manhattan also maintained its position as the priciest market for office leasing, with asking rents averaging $67.93 per square foot—more than double the national average of $32.89 per square foot. Across gateway metros, only San Francisco hit a similar figure at $67.32 per square foot, trailed by Boston ($57.98 per square foot) and the Bay Area ($54.74 per square foot).

In August, Christie’s signed a 25-year renewal at the Rockefeller Center, a 770,282-square-foot office midrise owned by Tishman Speyer. The London-based auction house has been a tenant here since 1997 and will continue to occupy 400,000 square feet at the property where its U.S. headquarters is located.

Bloomberg LP also signed a significant deal earlier this year: The company inked an 11-year extension at 731 Lexington Ave. to fully occupy the 946,815-square-foot building. Bloomberg moved to the tower in 2005, initially taking 679,000 square feet.

Manhattan is still a flex office hotspot

The coworking sector in Manhattan reached approximately 11.2 million square feet—the largest flex office inventory in the U.S. The borough’s share of coworking space as percentage of total leasable office space stood at 2.2 percent, on par with Los Angeles’ and surpassing Chicago’s (2.0 percent), Boston’s (1.8 percent) and Washington, D.C.’s (1.6 percent).

The flex office provider with the largest footprint in Manhattan remained WeWork, with its locations totaling 2.4 million square feet. The company was followed by Industrious (1.3 million square feet), Regus (727,600 square feet), Convene (567,550 square feet) and Spaces (555,000 square feet).

Earlier this year, Industrious signed a lease extension and expansion totaling 27,630 square feet at 860 Broadway. During the same period, Convene also expanded its footprint at 360 Madison Ave. with 22,519 square feet, bringing its total commitment at the 25-story building to 68,000 square feet. The company is occupying three full floors at Stawski Partners’ nearly 360,000-square-foot property.

The post Manhattan Office Shows Strength in a Still Lackluster Market appeared first on Commercial Property Executive.

BXP has chosen CBRE as its exclusive leasing agent for 343 Madison Avenue, the developer’s 950,000-square-foot office project that’s underway less than a block from Grand Central Terminal in Manhattan.

In fact, the 46-story tower will have direct access to Grand Central’s Madison Concourse between 44th and 45th streets.

The building was designed by Kohn Pedersen Fox as a fully electric, zero-carbon workplace and will feature a hospitality-inspired amenity package. For starters, a double-height lounge and conference space on the 45th and 46th floors will include indoor and outdoor dining and collaboration spaces, with biophilic terraces overlooking Midtown Manhattan. Other amenities include a lobby café and bicycle storage with cabanas and showers.

CBRE’s brokerage team of Howard Fiddle, Peter Turchin, John Maher, Evan Haskell and Caroline Merck will lead the building’s leasing campaign.

READ ALSO: Sage’s CEO on the New Realities of Manhattan’s Office Market

343 Madison Avenue’s 40 workplace floors range from 27,500 square feet in the podium to 22,000 square feet in the high-rise. Among those are specialty floors with private terraces and increased ceiling heights that will let clients design a multi-functional workplace to accommodate a variety of work styles and space needs.

In addition to a fully electric building design, the tower will feature zero on-site combustion and a high-efficiency direct outside air system. Its targeted sustainability certifications include LEED Platinum, Well Core, Energy Star 85+, Fitwel and WiredScore Platinum.

In the first phase of the 343 Madison Avenue development, construction recently began on a new accessible street entrance to the Long Island Rail Road’s Grand Central Madison Concourse at 45th Street and Madison Avenue.

Manhattan’s robust leasing activity

In July, CBRE, which had already been a decades-long tenant at 200 Park Ave., also known as the MetLife Building, extended its 180,000-square-foot lease into 2037. Further, the company assumed the responsibilities of exclusive leasing agent and property and asset manager for the owner, Irvine Co. 

Manhattan’s Midtown submarket has the majority of the top office leases in the third quarter, according to a report from CBRE. These include Christie’s renewing 373,000 square feet at 20 Rockefeller Plaza, Willkie Farr & Gallagher LLP renewing and expanding for 316,000 square feet at 787 Seventh Ave., Ares Capital Corp. renewing and expanding for 307,000 square feet at 245 Park Ave. and Balyasny Asset Management renewing and expanding for 164,000 square feet at 767 Fifth Ave.

Overall, Midtown had seen 11.1 million square feet of leasing activity by the end of September, versus 7.9 million over the same period last year. The average availability was 17.4 percent.

The post BXP Unveils NYC Skyscraper Design, Taps Leasing Agent appeared first on Commercial Property Executive.

Office visits in October this year were compared to October 2019. While traffic numbers continue to play catch-up, the latest data is the highest recorded since February 2020. And we all know what happened after that.

The firm’s index analyzes foot traffic data from over 700 commercial office buildings in key markets, including Miami, New York City, Atlanta, Dallas, Washington, D.C., Boston, Chicago, Denver, Los Angeles, Houston and San Francisco. It includes those with retail (such as a coffee shop) on the first floor. Mixed-use buildings are not included.

New York City was the most active market, with October visits at 86.2 percent of October 2019’s levels, followed by Miami at 82.6 percent.

“Office attendance in NYC has picked up, but nowhere near 86.2 percent of October 2019’s levels. Even on the best of days, you still see noticeably fewer people on the subway, picking up lunch, etc., than pre-pandemic,” Pierre Debbas, co-founder of Romer Debbas, New York, told Commercial Property Executive.

“We have likely hit a new norm in office attendance given that the major corporations who planned on enacting mandates have already done so, and small businesses continue to reduce their office exposure or continue with the flexibility of their workforce,” Debbas added.

READ ALSO: Innovative Solutions for Return-to-Office Challenges

South Florida continues to lead the nation in return-to-work, according to Matthew Schnur of the Fort Lauderdale Downtown Development Authority. Fort Lauderdale employees have returned to the office at a rate 20 points higher than the national average for the past four years.

From Fortune 500 headquarters to major professional services firms, downtown Fort Lauderdale’s offices remain buzzing with activity and have added more than 3,000 new jobs over the past year. 

“Cities like Fort Lauderdale provide a roadmap for how major employment hubs can bounce back in the post-pandemic era,” Schnur said. “With over $350 million of investment in public spaces underway, thousands of new apartments, 50 new restaurants and multiple cultural venues opening over the past four years, we’ve built a dynamic downtown full of new experiences.”

Markets with significant return momentum include Washington, D.C. (16.4 percent), Boston (15.6 percent) and Atlanta (13.8 percent).

One-third mandate in-office, full-week

More companies are requiring employees to work in the office full-time. About 33 percent of U.S. employers mandate full-time in-office work, which is expected to rise slightly in 2025, according to Doug Ressler, business manager at CommercialEdge.

He told CPE that hybrid models remain popular despite the push for more in-office work. Many organizations balance remote and in-office work to accommodate employee preferences and operational needs.

There’s a growing trend of employees finding ways to navigate these mandates, such as “coffee badging,” where they briefly show up at the office before working remotely.

HR leaders are increasingly caught between executive demands for in-office work and a workforce that prefers flexibility. This tension will continue, requiring HR to enhance their data tracking and policy enforcement skills.

“More companies are expected to reconfigure their operating models by leveraging freelancers and contractors, supported by AI and automation,” Ressler said. “This approach is anticipated to grow from 27 percent to 33 percent of organizations globally by 2025.”

According to Ressler, the conversation is shifting from where employees work to how they work. “Embracing AI, flexible talent strategies, and hybrid work will be crucial for success in the evolving macroeconomic environment. These trends highlight the dynamic nature of the workplace and the need for employers and employees to be flexible and adaptable,” he added.

In September, Inspired by Somerset Development, the firm behind Bell Works in New Jersey, announced more than 75,000 square feet of new and extended office leases. These deals have brought the property to a 98 percent occupancy rate, according to Ralph Zucker, the firm’s CEO.

“We’ve seen consistent year-over-year growth in daily employees returning to the office at the highest levels since 2020. This further underscores our metroburb model, which encourages employees to be in person,” Zucker said.

Food lures employees, makes them happy

In Grace Hill’s KingsleySurveys, tenants were asked about their in-office policies. The three categories of in-office policies included required full return to office, mandatory partial office attendance and optional office attendance. Optional office attendance declined by 3 percent from 2023 to 2024, while mandatory partial office attendance and required, full return to office increased by 2 percent each.

“If you’re trying to keep your tenants satisfied when they’re in the office, we highly recommend focusing your efforts on food amenities,” Jen Tindle, vice president of Strategic Insights at Grace Hill, told CPE.

Grace Hill’s KingsleySurveys also asked tenants for their top three amenities requests. Based on hundreds of thousands of responses, seven of the top 25 were related to food.

Guckenheimer for instance focuses on workplace dining programs.

“We’ve seen client employees leveraging on-site food at or above pre-pandemic levels on Tuesday, Wednesday and Thursday, with “shoulder days” Monday and Friday at about 50 percent,” said Guckenheimer CEO Paul Fairhead.

“That reflects what is becoming the standard in hybrid work models. We have also found participation on shoulder days is directly related to commutation—if someone’s commute is an easy suburban drive, the numbers are up,” he observed. If the commute is longer and more arduous, the drop in population is even more prominent.

“Through entertaining activities, agility in labor solutions and space programming, as well as creative menu-ing, however, we’re building a little FOMO among client employees and gradually driving greater participation on the shoulder days while remaining cost-neutral compared to the rest of the week.”

More in-office days for tech workers

“We continue to see increasing occupancy trends within the technology sector,” Robert Kolar, division president, technology, JLL Work Dynamics, told CPE. He added that many tech companies are putting forth more specific return-to-office policies and measuring show-up rates differently now than a year ago. Furthermore, employees are also more acutely aware that time in the office is noticed and, in some cases, tracked more closely, which is influencing behaviors.

In JLL’s 2024 Future of Work Survey, 43 percent of technology respondents expect the number of in-office days to increase between now and 2030.

“Gateway cities see the strongest trends of increased office attendance, such as New York City, where numbers are closing in on pre-pandemic levels,” Kolar said.

“Office activity further supports retail, hotels and restaurants, creating a more vibrant local economy in the places where activity levels are improving. The upward trend in 2024 will continue into 2025 as employer expectations are more clearly communicated and employees adapt to those expectations.”

Return to office boosting economies nearby

The increase in foot traffic is seemingly due to the push for return-to-office across industries, according to Robert Sandler, real estate + leasing partner with Farrell Fritz, New York.

“This, in turn, creates a more active and healthy commercial office leasing market, but there are some caveats to that,” Sandler said. “The Class A and higher amenity buildings continue to outweigh older buildings, as many struggle. Clients who invest and upgrade their properties fill their offices at higher occupancy rates.”

Major employers have slowly been mandating more frequent in-office days for employees, according to Todd Monahan, executive vice president & managing director of WCRE/CORFAC International.

“Once reluctant to force a return to the office for fear of losing valuable employees, employers now insist on at least two or three days in the office each week,” Monahan said. Downtowns and central business districts are noticeably more populated, especially on Tuesday, Wednesday and Thursday.

Employees who changed jobs once or twice since 2020 are now reluctant to move simply due to the ability to work remotely, Monahan observed. “Especially now that those options are slowly evaporating, given that most employers are mandating a return to office.”

READ ALSO: Why Slow Return-to-Office Doesn’t Threaten Office REITs Now

In San Francisco, downtown’s high-rise office district is seeing a gradual return of office workers boosting ground-floor retail and dining. But this doesn’t capture the full picture of the city’s rebounding strong economy, according to Ali McEvoy at Maven Commercial.

“Many of the city’s neighborhood corridors are thriving, with vacancy rates below 10 percent—and sometimes under 5 percent. Cafés and nightlife are buzzing again, thanks to a mix of tourism and residents, and, yes, a growing portion of returning office workers.”

People are returning to the workplace in San Francisco, confirms Ed Del Beccaro, executive vice president & San Francisco Bay Area regional manager at TRI Commercial Real Estate Services/CORFAC International. More employers are demanding it, as are some co-workers, he added. However, as leases come up for renewal, some tenants are downsizing their office space, generating higher vacancy rates.

“We see more people on Tuesday, Wednesday and Thursday and less on Monday and Friday. So, adjoining retail sites still are not getting pre-pandemic foot traffic. But good news: Back to work.”

Flight to quality wins the day

The office sector’s flight to quality positively impacts office traffic trends in markets such as Salt Lake City, where the average office rental rates are up from last year, according to Tim Helgeson, senior vice president at KBS and asset manager for Millrock Park.

“With companies like Amazon and Starbucks encouraging employees to return to the office five days a week, the trend is clearly on the rise,” Helgeson said.

Since January 2023, KBS has signed 106,912 square feet of new, renewal and expansion leases at Millrock Park, a four-building, 494,289-square-foot Class A office park in Holladay, one of Salt Lake City’s most desirable submarkets.

“This continued leasing momentum at Millrock exemplifies the overall appeal of best-in-class office space in key markets throughout the country,” he said.

According to Colliers, Salt Lake City’s average asking rates for office leases have steadily increased, particularly downtown.

“Some industries are not only maintaining their current office footprints but also expanding them, such as professional service firms,” Helgeson observed. “Many of these companies are attracted to well-located, highly amenitized office properties as they seek ways to attract and retain top talent.”

Hybrid model is ‘the norm’

Companies are walking a fine line with employees when dealing with returning to the office or working from home, according to Robert Martinek, director at EisnerAmper.

There are still a vast number of employees who want to work remotely indefinitely, he added, but the hybrid model is now the new norm. “This allows flexibility for everyone in the company. After the pandemic forced many workers to work from home, we see people slowly trickling back into the office.”  

The vast majority of respondents say there are benefits to having employees in the office versus working from home, according to Martinek. Business leaders cite improved communication, creativity, productivity and company culture. Additionally, some companies offer incentives for employees to return, including catered meals, commuter benefits and higher pay, he added. Younger staff often go into the office seeking interaction and guidance.

“Some people indicate they will leave their jobs if a strict return to office is implemented. However, I suspect as the labor market loosens and fewer jobs become available, more people will return to the office regularly.”

More productivity when employees show up

When businesses in the same industry compare themselves to their competitors who are back to the office versus their remote policy, remote office revenue is not as high, their culture is less dynamic, and their ability to retain and attract talent is not as strong, according to Gordon Ogden, executive managing director in the New York office at Bradford Allen.

“Mandates are being won by businesses who show up in person versus a Zoom call. In-office is recognized as better from top to bottom and bottom to top,” Ogden said. Executives believe their businesses are more productive when everyone is in at least four days per week and, ideally, five unless there are employees who have commutes over two hours each way, in which case four days per week is acceptable.

“Employees have found that social interaction is welcome, and amenity-laden offices have benefits not found at home. Many employees appreciate the energy of colleagues, synergies created to accomplish tasks, and the change of scenery between home and office.”

Ogden said most businesses have found that technology solves the mechanics of remote work. However, most workers require in-person social interaction to advance business goals and objectives, he observed.

And while the return-to-office trends are not unique, according to Philip Metzger, senior designer at IA Interior Architects’ Denver studio, the city’s mile-high goals bring unique challenges.

“Finding the right location is essential for brands and teams,” he said. “Still, the real catalyst is the need for intentional, high-functioning spaces as committed to impactful design as those who use them. The best workplaces are purpose-driven, embracing thoughtful amenities and designs that foster genuine connections and echo our region’s active, adventure-driven spirit.”

Office culture is undoubtedly returning in Denver, Metzger told CPE. “Still, at the same time, we are blazing new trails, with brands and people drawn by the unique opportunity to be in the heart of the country and combine vibrant urban life with the Rocky Mountain experience.”

The post Return-to-Office Traffic Reaches Record Level appeared first on Commercial Property Executive.

When RFR bought 102 Greene, they expected a 6.5 percent return on their investment based on the property’s income, but the property was later sold at a higher price, resulting in a lower 4.25 percent return for the new buyer.

The company purchased 102 Greene two years ago for $43.5 million, in a period when Soho vacancies were at historic highs. Investment firm TA Realty and SL Green Realty sold the asset.

Cartier occupies the four-story flagship retail property at 102 Greene. The Paris-based architectural firm Studioparisien renovated the building, blending Cartier’s design with SoHo’s industrial and artistic heritage. The property includes luxury goods sales and product care services, a green marble bar with lounge seating, a loft with living and dining areas, and a rooftop garden.

READ ALSO: Shopping Changed Dramatically. Retail Design Is One Step Ahead.

102 Greene Street, designed by architect Henry Fernbach alongside its sister building at 96 Greene Street, was completed in 1881 as a five-story building. It has housed notable tenants, including S. Epstein & Sons and sculptor William Tarr, who created the iconic cast iron door and panel at the entrance.

Demand for the luxury retail industry in the city’s top neighborhoods is expected to rebound strongly, according to RFR’s Principal Gaby Rosen. Adirondack’s Managing Partner Michael Hunter Coghill highlighted that this transaction emphasizes SoHo’s lasting appeal as a prime destination for retail investment.

Manhattan’s increased retail activity

Manhattan’s retail market-driven by strong consumer confidence, increased office occupancy, a tourism boom and New York Fashion Week- experienced continued growth in the third quarter of this year.

Limited availability and strong demand in prime Manhattan retail areas pushed asking rents higher for the eighth consecutive quarter, up 3.1 percent, according to a recent Cushman & Wakefield report. Pricing recovery varied by neighborhood, with SoHo seeing a 19.0 percent year-over-year increase in average asking rent to $388 per square foot.

The post RFR Sells SoHo Retail ‘Jewel’ for $46M appeared first on Commercial Property Executive.

The 137,470-square-foot building at 2100 Smithtown Ave. will be a purpose-built cold storage asset with insulated metal panel construction and feature a fully convertible freezer/cooler with temperature ranges of –10 degrees Fahrenheit to +35 degrees Fahrenheit.

The warehouse is set to feature a 40-foot clear height with a 28-foot cold dock and an insulated glycol floor slab. The property will also include 18 loading docks expandable to 25, one drive-in door and parking for 194 cars.

Thomas DeLuca, Frank Frizalone, Nick Gallipoli and John Giannuzzi of Cushman & Wakefield will market the property.

READ ALSO: Why Cold Storage Is Getting Hotter

The facility has been designed to accommodate either a single user or a multi-tenant scenario, Venture One Senior Vice President Brian McDonagh told Commercial Property Executive. He added that an office building previously on the site had to be demolished before this project could proceed.

The site is adjacent to the Long Island MacArthur Airport, just north of Veterans Memorial Highway. The location is also close to Long Island Expressway, which provides access to Hunts Point Cooperative Market, the world’s largest food distribution center.

Cold stays hot

The strength of the cold storage sector is clear not just in acquisitions, but even more so in recent development projects, despite construction costs two to four times higher than those for dry industrial buildings.

Last month, Saxum Real Estate broke ground on a 322,600-square-foot build-to-suit cold storage facility in Crown Point, Ind., for Arcadia Cold. Delivery is expected in the second quarter of 2026.

In September, BGO and Yukon Real Estate Partners started construction on a 291,000-square-foot cold storage property near Kansas City, Mo. This project too is already spoken for, with CJ Logistics America having committed to taking the entire facility.

And in August, RL Cold and BGO broke ground on a 215,766-square-foot spec cold storage warehouse in Mount Laurel, N.J. That development is rising on the site of a former office building as well.

The post Venture One, BGO Get Underway on Long Island Cold Storage Facility appeared first on Commercial Property Executive.

With Meta Platforms set to leave 770 Broadway in Manhattan’s East Village early next year, New York University has agreed to master lease the entire 1.1 million square feet of office space at Vornado Realty Trust’s 14-story mixed-use building.

Under a letter of intent, NYU has an option to buy the office space in the 30th year and the 70th year of the lease.

“Both parties have signed a detailed letter of intent and expect to execute final binding papers shortly. I expect the closing and rent commencement would occur in January,” Vornado Chairman & CEO Steven Roth said during Tuesday’s third-quarter earnings call with analysts. “The master lease will provide for an upfront payment of prepaid rent sufficient to pay off our $700 million loan on the property, as well as an annual net rent over the lease term.”

Further details about NYU’s plans for the office space were not disclosed but the private university is one of the city’s largest and wealthiest landlords with more than 100 properties in Manhattan and Brooklyn.

“770 Broadway is an exciting and important development, critical to fulfilling NYU’s bold aspirations in science and tech, and important because of its proximity to our campus core’s science facilities. We look forward to finalizing this transaction and then sharing more about our plans,” John Beckman, NYU spokesperson, told Commercial Property Executive.

READ ALSO: What’s In, What’s Out in Office Design?

Roth first hinted at a major upcoming deal during the firm’s August second-quarter earnings call. At that time, he said they had a “handshake deal” with an unnamed tenant to master lease all the office space.

Building spotlight

Meta, parent company of Facebook, Instagram and other social media apps and a tenant at the building since 2018, had at one point leased about 775,000 square feet but currently leases 500,000. Earlier this year, Meta announced it was cutting 225,000 square feet of space there as of June. In July 2022, the social technology giant halted plans to expand space at 770 Broadway and in the Hudson Yards development on Manhattan’s Far West Side as it reduced office space at numerous sites around the country amid layoffs.

Vornado has owned the building since acquiring it in 1998 for $149 million. Completed in 1906, the building takes up an entire block between Ninth Street on the north, Fourth Avenue to the east, Eighth Street to the south and Broadway to the west. Vornado completely renovated the LEED Gold-certified property, located on 1.4 acres, in 2000.

The property’s most current debt, a five-year $700 million loan from a private lender, was originated in July 2022 and is set to mature on July 1, 2027, according to CommercialEdge data.

The building has more than 166,000 square feet of retail including a Bank of America on the street level. Wegmans Food Markets occupies two levels—a lower level and street level—totaling about 87,500 square feet.

Vornado’s leasing activity

In late September, Vornado announced accounting firm Weaver and Tidwell LLP had significantly expanded its space at PENN 1, the recently redeveloped 2.5 million-square-foot office tower in the Penn District. The firm had been occupying 8,000 square feet on a portion of the 32nd floor but will now lease the entire 28th floor, with a long-term agreement for 36,500 square feet.

Vornado has leased 2.1 million square feet of office space year-to-date in Manhattan, Roth said during Tuesday’s earnings call. He added he was confident the REIT would sign between 3.5 million square feet and 3.8 million square feet of Manhattan leases this year.

Current office occupancy across Vornado’s portfolio was 87.5 percent in the third quarter, down from 89.3 percent in the second quarter, primarily due to the previously announced Meta expiration at 770 Broadway, Michael Franco, Vornado’s president & CFO, said during the earnings call.

“As occupancy rises, our earnings will go up. With a pending full building master lease at 770, our office occupancy increases by 330 basis points to 90.8 percent,” Franco told the analysts.

The post NYU to Lease 1.1 MSF at Vornado Property appeared first on Commercial Property Executive.

Rosen Equities has signed a 10,035-square-foot lease at The Bricken Arcade, its 149,000-square-foot office building in Manhattan’s Garment District.

Junior Achievement of New York, a local affiliate of Junior Achievement USA, will occupy the entire second floor of the 18-story property.

CBRE represented the tenant while Olmstead Properties worked on behalf of the landlord as exclusive leasing agent.

The non-profit organization will use the space as a learning center. BKSK Architects, Michael Stuart Design and C&C Button Inc. are also among the property’s tenants, according to CommercialEdge.

Located at 230 W. 38th St., The Bricken Arcade was completed in 1928. The mid-rise office building includes five passenger elevators, floorplates ranging from 6,500 square feet to 11,000 square feet, as well as 17,557 square feet of retail space, the same source indicates.

Completed in 2016, the property’s last renovation featured upgraded elevators and restrooms, a redesigned common-area lobby, new windows and a new heating plant. New services were also added, including an on-site building manager and cardkey after-hours access.

The Bricken Arcade is close to the Penn Station and to multiple subway stops while being 3 miles from Lower Manhattan, 6 miles from Financial District and within 16 miles of John F. Kennedy International Airport. CBRE’s Paul Walker worked on behalf of Junior Achievement of New York, while Olmstead Properties’ Daniel Breiman represented the ownership.

Manhattan’s office vacancy sees slight improvement

Office vacancy rates continue to climb in the country, with the national rate clocking in at 19.5 percent in September, representing a year-over-year increase of 170 basis points, according to a recent CommercialEdge office report. Manhattan remained the most expensive office market in the U.S., with asking rents averaging $67.93 per square foot, while office vacancy, despite national trends, saw a 90 basis points year-over-year decrease.

Recent deals in Manhattan include SL Green Realty Corp.’s 72,515-square-foot long-term lease at 245 Park Ave. The tenant is Verition Group NY, which almost doubled its footprint at the 1.7 million-square-foot office tower. Another recent deal is law firm Hecker Fink LLP’s 26,782-square-foot commitment at the Empire State Building. The transaction expanded the firm’s footprint at the iconic Midtown Manhattan skyscraper to a total of 53,779 square feet.

The post Rosen Equities Lands New Tenant in Manhattan appeared first on Commercial Property Executive.

Law firm Hecker Fink LLP has signed a full-floor, 26,782-square-foot lease expansion at the Empire State Building in Midtown Manhattan. The tenant will occupy a total of 53,779 square feet of space across two floors.

Savills negotiated on behalf of the tenant, while the landlord, Empire State Realty Trust, was represented in-house, with the assistance of Newmark.

Hecker Fink LLP has been a tenant at the 102-story iconic skyscraper for the past seven years and the expansion reflects the company’s continuous growth, said Founding Partners Sean Hecker and Julie Fink, in prepared remarks.

Notable tenants at Empire State Building include LinkedIn, Capco, Shutterstock Inc., Turkish Airlines, The Alberleen Group, Skanska and First American Equities, according to CommercialEdge.

Upgrades and cosmetic renovations

Empire State Realty Trust picked up the 2.8 million-square-foot iconic office building in 2013 as part of a $711 million portfolio deal with seller Helmsley Enterprises, according to the same source. Completed in 1931, Empire State Building features floorplates between 12,905 square feet and 100,512 square feet, 64 passenger elevators, an on-site conference center, a fitness center and 127,256 square feet of first-floor and mezzanine-level retail space.

The property’s upgrade and cosmic renovations started back in 2008 and total more than $650 million, with the latest improvements happening in 2011 and 2019. Earlier this month, ESRT opened the Empire Lounge, a 10,000-square-foot new amenity space that can host up to 400 people and that includes pickleball and basketball courts, as well as two golf simulators.

Additionally, amenities at the property include more than 65,000 square feet of space and feature on-site dining options, a 23,000-square-foot Starbucks Reserve and access to The Campus, an amenity center connected to ESRT’s 1333 and 1400 Broadway.

A leasing momentum

Savills’ Vice Chairman, Director & Co-Branch Manager Ira Schuman represented Hecker Fink LLP. The ownership was represented in-house by Vice President of Leasing Shanae Ursini and Newmark’s Vice Chairman Scott Klau, Executive Managing Director Erik Harris and Managing Director Neil Rubin.

The deal follows multiple recent commitments at the property. In early 2024, Greater New York Mutual Insurance Co., a 109-year old insurance company, signed a full-floor, 52,116-square-foot deal. In July, consulting firm Kearney signed a 27,866-square-foot lease at the office building’s top two floors, relocating its New York team. A few months prior, fintech company Pontera Solutions Inc. relocated from another Manhattan office property owned by the same landlord to a 40,679-square-foot space at the Empire State Building.

The post ESRT Inks 54 KSF Expansion at the Empire State Building appeared first on Commercial Property Executive.

Macerich has refinanced Queens Center, a 968,000-square-foot shopping mall in Elmhurst, N.Y. The owner obtained a new $525 million loan that features a fixed interest rate of 5.37 percent and interest-only payments.

This marks the lowest refinancing rate the company has achieved since 2019, Macerich President & CEO Jack Hsieh said in prepared remarks. In addition, the deal is more favorable than what Macerich anticipated in its spring 2024 five-year forecast.

The property’s previous debt included a $600 million CMBS loan originated by Wells Fargo Bank in 2013, having U.S. Bank as trustee, according to CommercialEdge data. The note was due to mature next January.

A top-performing shopping mall

Queens Center consistently has been one of the top-performing assets in Macerich’s portfolio, according to Hsieh, being one of the most productive malls in the nation during its 50-year history.

The mall came online in 1972 on a 10-acre site formerly occupied by an amusement park, a supermarket and a parking place. Between 2002 and 2004, the property underwent a major redevelopment project, completed in two phases, which also expanded its original 605,000-square-foot size.

READ ALSO: Inside the Retail Stores of the Future

The tenant roster includes a diverse mix of retailers such as JCPenney, Macy’s, Abercrombie Kids, Timberland, Chick-fil-A, The Cheesecake Factory, Apple, Adidas, Applebee’s, Burlington, Chipotle, Claire’s, Dunkin’ Donuts, Game Stop, Foot Locker, KFC, MAC Cosmetics, Sephora, Shake Shack and Starbucks, among many others.

Primark, H&M, Warby Parker, Gap and Kiko Milano will soon open their doors in the Macerich-owned section of Queens Center, filling all available retail space. Ashkenazy Acquisition Corp.—which owns the JCPenney building at the mall—also recently announced that a Burlington store will open on its first floor just in time for the holiday season.

Located at 90-15 Queens Blvd., the shopping mall is at the junction of Queens Boulevard, the Long Island Expressway and Woodhaven Boulevard, featuring high visibility and accessibility. As the only super-regional mall in Queens, the property serves approximately 415.000 individuals within a 2-mile radius, according to Macerich. Its total trade area amounts to more than 2.4 million people.

The post Macerich Lands $525M for Queens Mall appeared first on Commercial Property Executive.

SL Green Realty Corp. has signed a 72,515-square-foot, 10-year lease with Verition Group NY Inc. at 245 Park Ave. in Manhattan. Cushman & Wakefield negotiated on behalf of the landlord, while Newmark represented the tenant.

The hedge fund is expanding its footprint in the Class A building by 34,413 square feet, relocating from the 35th floor to take all of the 14th and 15th floors. The move hikes the building’s occupancy to 92.5 percent and also increases SL Green’s office leases signed year-to-date to a tad north of 3 million square feet.

The REIT paid nearly $1.8 billion for 245 Park in 2022, according to CommercialEdge information. One year later, SL Green sold a 49.9 percent interest in the property to a U.S. affiliate of Mori Trust Co., a Tokyo-based developer and investor.

The 45-floor, 1.7 million-square-foot office tower came online in 1966. The high-rise features floorplates averaging 79,508 square feet and 68,000 square feet of retail space.

The building is currently undergoing a renovation that includes a new lobby and plazas, new storefronts, new windows and a terra cotta overclad of the Park Avenue podium facade. New amenities will include a tenant-only wellness center with a large fitness center, country club-style golf lounge and upscale cafe operated by Michelin star chef Daniel Boulud’s team.

READ ALSO: Office Design Trends: What’s In, What’s Out?

Other major tenants at the property include Chase, Societe Generale, Ares Commercial Real Estate and Houlihan Lakey, according to CommercialEdge. Ares recently expanded its presence in the building to roughly 307,000 square feet.

Newmark’s Bill Levitsky and John Cilmi Jr. represented Verition Group. SL Green was represented by Cushman & Wakefield’s Bruce Mosler, Harry Blair, Tara Stacom, Ron LoRusso, Justin Royce, Pierce Hance and Will Yeatman.

Quality still sells

Manhattan’s office market saw 5.3 million square feet of new leasing demand in the third quarter, which was a 15.9 percent decrease from the previous quarter, but nonetheless the second-highest quarter in the past two years, according to a report from Cushman & Wakefield.

Asking rents in Midtown amounted to $78.21, and up to $96.28 for Class A space. “Limited quality space options will likely place continued upward pressure on Class A rents,” Cushman & Wakefield reported.

In one of the quarter’s larger leasing deals, Christie’s signed a 25-year lease renewal at Tishman Speyer’s Rockefeller Center. The auction house occupies about 400,000 square feet at 20 Rockefeller Plaza.

More recently, another SL Green property was the scene of a significant office lease, as Bloomberg renewed and expanded its commitment at 919 Third Ave. The 1.5 million-square-foot tower is also in Midtown.

The post SL Green Signs 73 KSF Manhattan Tenant appeared first on Commercial Property Executive.

The 120,000-square-foot, 22-floor office building at 360 Bowery is set to open in the fourth quarter of 2025 and will be about much more than just running the business, according to a company statement.

Chobani House is set to bring a new model for urban development to the city’s NoHo neighborhood, by blending business, community investment and impact. Chobani said it’s embracing a new vision for how businesses can invest in and deliver sustained impact for their home community.

Peter Michailidis and Dan Posy of JLL represented the tenant in the building lease, while David Kleiner and Carlee Palmer, also of JLL, represented the landlord, CBSK Ironstate, according to The Real Deal.

Chobani’s employees will have a four-day-per-week in-office schedule. The building will also include a community kitchen preparing meals for those in need, experiential retail space and an incubator lab for emerging NGOs and non-profits focused on social impact.

READ ALSO: How Neurodivergent-Friendly Office Design Can Benefit Everyone

Located in the Hudson Waterfront South area, the project signals Chobani’s commitment to NYC for the next 30 years. Chobani said it appreciates New York City’s location, with its rich tapestry of people, energy, grit and determination.

Community invetsment, impact

Chobani House will also host the Tent Partnership for Refugees, an organization founded by Turkish billionaire and Chobani founder, Hamdi Ulukaya.

This network of over 400 major companies is committed to helping refugees from countries in the Americas and Europe access local labor markets by assisting them to become job-ready and connecting them to work.

NoHo is considered a trendy neighborhood where creative meets chic. About 2 miles south of the Empire State Building, the area has architectural features ranging from 19th-century behemoths like the Great Hall of Cooper Union to sleek, modern high-rises.

Once home to artists like Andy Warhol and the legendary CBGB music club, the area stays true to its heritage with trendy galleries and live performances at Joe’s Pub. A place where well-heeled locals mingle in upscale bars and stylish restaurants.

The post Yogurt Company Unveils NYC Headquarters appeared first on Commercial Property Executive.

Empire State Realty Trust Inc. has landed a new tenant at 1359 Broadway, a 481,167-square-foot office asset in Manhattan, N.Y. Bloomsbury Publishing Inc. signed a lease for 24,209 square feet with assistance from Cushman & Wakefield. An in-house representative alongside CBRE negotiated on behalf of the landlord.

Rising 22 stories, the building—designed by George & Edward Blum—debuted a century ago. Floorplates range between 8,690 and 24,495 square feet, while the ceiling height clocks in at 11 feet and 2 inches slab to slab.

The property’s upgrade program included lobby ceiling restorations, as well as an overhaul of the building’s systems including electrical, plumbing, HVAC and security. Being fully powered by renewable wind energy, 1359 Broadway attained WELL, Fitwel and Energy Star Certifications.

Other building tenants include New York State Energy Research and Development Authority, Crown Castle and Inmar Intelligence, among others. The retail tenant roster comprises Starbucks, Wolfgang’s Steakhouse and Panera.

READ ALSO: Sizing Up the Prime Office Building Landscape

The property is within walking distance of Bryant Park and the Empire State Building, as well as Penn Station. In its vicinity, numerous quick-service restaurants, retail facilities and transit stops operate.

Cushman & Wakefield Executive Managing Director Stephen Bellwood alongside Associate Rachel Rosenfeld represented Bloomsbury in the negotiations. Empire State Realty Trust Vice President Jordan Berger together with a CBRE team including Vice Chairmen Paul Amrich and Neil V. King III, as well as Executive Vice President Emily Chabrier and First Vice President Meghan Allen, represented the landlord.  

Publishers on Broadway

The independent publishing house—whose works include Harry Potter and Crescent City—had previously occupied the entire fifth floor at 1385 Broadway, just one block away from its new office space. Culbro owns the 533,500-square-foot asset, according to CommercialEdge data.

Bloomsbury U.S. President Sabrina McCarthy, who joined the firm this February from Ingram Publisher Services, commented in prepared remarks that her previous employer leased office space at 1400 Broadway, also one of ESRT’s properties.

Manhattan’s office leasing activity bucks national trends

Compared to June, Manhattan’s office vacancy rate dropped by 20 basis points during the third quarter, reaching 23.5 percent in September, according to a report by Cushman & Wakefield. Several of the factors leading to the decline in availability were the removal of five office buildings slated for residential conversion and the lack of new office developments for two consecutive quarters.

Combined, new office leases and renewals in Manhattan totaled 22.7 million square feet year-to-date through September—a 33.1 percent increase year-over-year compared to the 17.1 million square feet registered last year—Cushman & Wakefield revealed.

During the third quarter, new office leases totaled 5.3 million square feet, the same source shows. Although down 15.9 percent quarter-over-quarter, the figure ranked as the second-highest three-month period in two years.

Another new Manhattan lease closed earlier this month. Fintech company Maybern agreed to occupy 11,000 square feet at GFP Real Estate’s 10 Astor Place, a 156,000-square-foot office property.

The post Harry Potter Publisher Signs Manhattan Office Lease appeared first on Commercial Property Executive.

As part of the transaction, the joint venture secured a five-year, $320 million loan facility. Lenders include Goldman Sachs and Blackstone, according to a report by The Real Deal.

The owners are touting the mixed-use building’s location, high ceilings, 100,000-square-foot-plus floorplates and vintage architectural elements as attractive to varied retail and office tenants.

The seven-floor building came online in 1896, according to CommercialEdge information. RXR acquired a 45 percent interest in the property for $225 million from The Chetrit Group in January 2012 and the remaining 55 percent in November 2012 for $255.6 million.

READ ALSO: Why the Office-to-Lab Conversion Trend Will Last

However, it was a $425.1 million refinance by Goldman Sachs in October 2019—just months before the World Health Organization officially declared the COVID-19 outbreak a pandemic—that put the building on a tricky course. Two prominent tenants, WeWork and Bed Bath & Beyond, went bankrupt, pushing the building to more than 50 percent in total vacancy.

Over the past two years, however, RXR nailed down more than 300,000 square feet of new and renewal leases to office tenants and induced long-time tenant 32BJ, an affiliate of the Service Employees International Union and the nation’s largest union of property service workers, to expand its lease by 21,000 square feet.

As a result, the building’s office component is fully occupied, and RXR reported that it’s in negotiations with multiple potential tenants for the remaining vacant retail space.

Leases vs. sales

Clearly, not all of 620 Ave. of the Americas’ neighbors are doing as well, because Manhattan’s Chelsea submarket currently has a total availability of 27.5 percent, according to a third-quarter report from Avison Young. That’s somewhat higher than the average for all of Midtown South, which is 21.2 percent, and higher still than the overall Manhattan average of 18.7 percent.

Transactions nonetheless seem to be ticking along. Three times so far this year, Chelsea properties have landed on Commercial Property Executive’s monthly tally of the top five NYC office building sales:

•  In January, it was Argentic Investment Management’s $21.5 million sale of 115 Seventh Ave., a 42,380-square-foot, 1924-vintage building, to Raymond Chan Architect PC.

•  In April, we reported the $31 million sale of 129 W. 29th St. by Samson Management to The Epoch Times, part of The Epoch Media Group. The 85,869-square-foot building was completed in 1911.

•  And in May, a private investor acquired the 7,410-square-foot 156 W. 29th St. for $6.3 million from a private seller, in a deal brokered by Cushman & Wakefield.

The post RXR Partners JV Secures $320M Recap for NYC Building appeared first on Commercial Property Executive.

In the largest CMBS loan deal for a single office asset to date, the joint venture of Tishman Speyer and Henry Crown & Co. has obtained $3.5 billion in refinancing for Rockefeller Center in Manhattan.

Bank of America and Wells Fargo served as co-lead managers on the five-year loan carrying a fixed interest rate of 6.23 percent.

Proceeds will repay the existing 20-year, $1.7 billion CMBS debt, along with mezzanine financing, scheduled to mature in May 2025. The note will also establish reserves for lease-related contractual obligations.

READ ALSO: Office Finance Freeze Begins Slow Thaw

Rockefeller Center came online almost a century ago and features 13 buildings totaling 7.3 million square feet. The joint venture became the sole owner of the 22-acre Midtown complex in April 2001, after purchasing the remaining 95 percent stake in the property for $1.85 billion, according to CommercialEdge.

The Class A campus comprises about 6 million square feet of office space, multiple retail destinations, event venues, dining options and tourist attractions. Recently, the ownership opened the 24,000-square-foot park atop Radio City Music Hall.

Rockefeller Center was 93 percent leased at the time of closing. The tenant roster includes Deloitte, Simon & Schuster, JP Morgan Chase and Lazard. Additionally, Christie’s signed a 25-year renewal for 400,000 square feet at 20 Rockefeller Plaza this August.

Over the years, the campus went through multiple capital improvements. Tishman Speyer renovated the Top of The Rock observation deck to provide new attractions and opened Skylift, a revolving glass-enclosed platform that elevates visitors nearly 900 feet in the air.

Inspired by the campus’ original plans, the ownership also restored the Channel Gardens and Rink areas as entrance points for tourists. In early 2020, the company obtained approval from the Landmarks Preservation Commission to open the underground passageways encircling the iconic Rink.

Manhattan’s largest office financing deals this year

Despite the economic constraints experienced during the last couple of years, significant office loans and refinancing transactions continued to close in Manhattan. In addition to strong fundamentals, the market recently saw an increase in year-over-year office attendance.

In June, Vornado Realty Trust obtained a $400 million refinancing loan for 640 Fifth Ave. The note has a fixed rate of 7.47 percent and is set to mature in July 2029.

And, two months prior, L&L Holdings Co. landed $911 million to refinance the 47-story 425 Park Ave. Sumitomo Mitsui Trust Bank originated the five-year note for the 670,000-square-foot tower.

The post Tishman Speyer JV Lands $3.5B for Rockefeller Center appeared first on Commercial Property Executive.

Bloomberg LP has inked a renewal and expansion lease at SL Green Realty Corp.’s 919 Third Ave., a 1.5 million-square-foot, 47-story office tower in Manhattan, bringing its footprint to 924,876 square feet at the high-rise. CBRE brokered the transaction.

The deal includes a 749,035-square-foot, 11-year lease extension starting March 1, 2029, and a new 175,841-square-foot 15-year expansion.

SL Green paid $500 million for the asset in 2000, acquiring it from Colonnade Properties, CommercialEdge data shows. Last year, the landlord partnered with J.P. Morgan to refinance 919 Third Ave. Aareal Capital Corp., Credit Agricole Corporate and Investment Bank originated a $500 million note to retire a previous loan in the same amount issued by Metropolitan Life Insurance Co. and Pacific Life Insurance Co.

A glimpse inside the renovated tower

Designed by Skidmore, Owings & Merrill, 919 Third Ave. debuted in 1970. In 2022, the tower underwent a $20 million renovation effort. Designer Studios Architecture and general contractor Structure Tone led the revamp, which touched on the lobby. Upgrades included a new ceiling, exterior glass, reception desks and lighting.

The high-rise features floorplates ranging between 30,000 and 48,000 square feet and roughly 12-foot slab heights, as well as three freight and 22 passenger elevators. Amenities at 919 Third Ave. include a coffee bar, bike room and a 19,000-square-foot open-air plaza. The tower’s certifications include LEED Gold, WiredScore Platinum, 2-Star Fitwel and WELL Health-Safety.

Office tenants include law firms such as Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, which committed to 101,394 square feet in 2021, as well as Schulte Roth & Zabel LLP, which renewed its 283,894-square-foot lease for another 15 years in 2014. The retail tenant roster comprises Chase Manhattan Bank, P.J. Clarke’s and One Medical.

Located in Midtown Manhattan, SL Green’s asset is a few blocks from RFR Realty’s Seagram Building, where Blue Owl Capital inked a 238,673-square-foot lease extension and expansion recently.

CBRE Vice Chairmen Howard Fiddle and Chris Mansfield, alongside Senior Vice President Zach Weil and Vice President Ryan Luck, represented Bloomberg. Chairman Robert Alexander, together with Vice Chairmen Ryan Alexander and Taylor Callaghan, as well as Executive Vice President Emily Chabrier, Senior Vice President Alexander D’Amario and Senior Associate Nicole Marshall, represented SL Green.

Bloomberg’s expansion in New York

This deal marked the third time Bloomberg’s presence grew at 919 Third Ave. Its previous expansion—which grew its footprint by 191,207 square feet—closed in 2021. The first expansion rose the company’s footprint by 204,442 square feet in 2016. Bloomberg had initially settled for 350,173 square feet the year before.

As of May, Bloomberg’s Big Apple presence encompassed more than 2.1 million square feet of office space. At the time, the company extended its full-tower lease at Alexander’s Inc.’s 56-story, 946,815-square-foot 731 Lexington Ave., also dubbed Bloomberg Tower. That extension will also take effect in 2029.

Manhattan office vacancy rate inches down

Manhattan office occupancy rates are healing—as vacancy dropped 90 basis points year-over-year—and availability clocked in at 16.8 percent in September, according to a report by CommercialEdge. The borough maintained its title as the priciest office market, with rates averaging $67.93 per square foot.

The shifting outlook in Manhattan’s office real estate trends is reflected by SL Green’s 2024 leasing momentum. Year-to-date, the landlord inked 150 leases in the borough for a total of 2.8 million square feet, including Bloomberg’s recent deal.

Additionally, SL Green expects to sign north of 3.3 million square feet of office leases throughout Manhattan in 2024, based on its arrangements to date and contract pipeline, which includes roughly 1.1 million square feet.

Another one of SL Green’s leases closed at 245 Park Ave., a 1.8 million-square-foot office tower also in Midtown Manhattan. Ares Management renewed and expanded its commitment to 307,336 square feet at the property. Last year, SL Green sold a 49.9 percent stake in the asset to Tokyo-based Mori Trust Co.

The post Bloomberg Expands to Nearly 1 MSF at Manhattan Tower appeared first on Commercial Property Executive.

RFR Realty has inked a lease expansion with Blue Owl Capital at The Seagram Building, an 891,998-square-foot office tower in Manhattan. The alternative asset manager expanded its 168,597-square-foot lease to 238,673 square feet. Cushman & Wakefield negotiated on behalf of the tenant, while RFR had in-house representation.

This is not the first time Blue Owl’s footprint has grown at The Seagram. Last year, the firm agreed to occupy an additional 31,597 square feet. The company had initially committed to 137,600 square feet in 2022 and has since nearly doubled its presence at the Class A+ property.

Including Blue Owl’s expansion, the office tower’s leasing commitments through year’s end total north of 350,000 square feet, which are set to bring its occupancy to nearly 100 percent. The tenant roster includes Fiera Capital, Centerbridge Partners and Clayton, Dubilier & Rice, among others.

A Class A+ office tower in Midtown Manhattan

RFR acquired The Seagram Building in 2001 from Nuveen Real Estate for $371 million, CommercialEdge information shows. Last year, the firm retired the property’s $1.1 billion debt dating back to 2013 through a $1.1 billion refinancing package, which included roughly $360 million in equity from JVP Management.

Designed by architects Ludwig Mies van der Rohe and Philip Johnson, the 38-story tower debuted in 1958. The high-rise features floor-to-ceiling windows, EV charging stations and bike storage, as well as floorplates ranging between 15,700 and 39,100 square feet. The tower is pursuing LEED and Fitwel certifications.

READ ALSO: Sage’s CEO on the New Realities of Manhattan’s Office Market

In 2022, the landlord completed the 34,000-square-foot Seagram Playground, which encompasses sports-oriented facilities and a townhall with a capacity of up to 240 people. Additional amenities include a terrace lounge on the 11th floor, as well as three restaurant and event spaces.

Carrying the address 375 Park Ave., The Seagram Building is less than 4 miles from Downtown Manhattan. Central Park, Rockefeller Center and the Grand Central are within 1 mile.

Cushman & Wakefield Mark Weiss negotiated on behalf of Blue Owl Capital. RFR Realty Executive Vice President AJ Camhi alongside Senior Vice President Paul Milunec provided self-representation.

A company in expansion mode

In fact, Blue Owl’s new office lease is not its only recent expansion deal. The company recently joined a $3.4 billion joint venture with Crusoe Energy Systems and Primary Digital Infrastructure to develop a 206 MW, 998,000-square-foot data center in Abilene, Texas.

And last week, Blue Owl entered an agreement to pay approximatively $1 billion for IPI Partners—a digital infrastructure fund manager founded in 2016 by a joint venture between ICONIQ Capital and Iron Point Partners. IPI had roughly $10.5 billion assets under management in June.  

Manhattan office demand goes up as visits increase

At a national level, most return-to-office policies went unenforced, as only 17 percent of the companies that have them actively executed them. However, Manhattan’s office visits inch closer to pre-pandemic levels.

The increase in office drop-by rates is reflected in Cushman & Wakefield’s report for the third quarter as leasing activity witnessed a boost. Year-to-date as of September, Manhattan’s new office leasing activity clocked in at 16.7 million square feet—a 31.1 percent spike from last year’s figure during the same interval.

As a result, the borough’s overall vacancy rate dropped by 20 basis points over the quarter reaching 23.5 percent, the report shows. An additional factor in the vacancy’s dip was the lack of new office developments for two consecutive quarters. 

During the first nine months, renewals totaled 6 million square feet, up 38.3 percent over the year. In total, the borough’s office leasing activity reached 22.7 million square feet year-to-date through September—an increase of 33.1 percent year-over-year.

Should market conditions hold, Manhattan’s office market could overtake 2023’s full-year leasing activity by the end of October, according to the report.

The post Blue Owl Capital Expands Manhattan Office Presence to 239 KSF appeared first on Commercial Property Executive.

Fintech company Maybern has signed a three-year, 11,000-square-foot lease at GFP Real Estate’s 10 Astor Place, a 156,000-square-foot office building in Manhattan. The tenant will relocate from 598 Broadway this month.

Maybern will use the new location as its executive and administrative office and will occupy an entire floor at 10 Astor. Previously leased by Force Therapeutics, the company’s new turnkey space was renovated in 2021.

Two Newmark teams negotiated on behalf of both parties. The landlord had in-house representation as well.

The seven-story building is part of Astor Place Plaza, a 390,000-square-foot campus that comprises creative offices, shared spaces and a retail component. The property’s tenant roster includes New York University, Chase Bank, Centennial Properties and Exbo Group, CommercialEdge shows.

READ ALSO: Why the NYC Office Market Is a Tale of 2 Cities

Originally built in 1876 as a factory and printing office by architect Griffith Thomas, the building at 10 Astor Place features two passenger elevators, 19,400-square-foot floorplates and a recently upgraded common-area lobby.

The property is in the NoHo district and has access to multiple subway and bus stops. John F. Kennedy International Airport is 20 miles away.

GFP Real Estate Asset Management & Leasing Associate Neith Stone, together with Newmark Executive Managing Director Robert Silver, Managing Director Anthony Sciacca and Associate Director Brittany Silver represented the landlord. Managing Director Jonathan Franzel and Associate Leo Koné with Newmark worked on behalf of Maybern.

Manhattan sees a drop in asking rents

Rental rates in Manhattan stood at $68.56 per square foot, showing a 1.5 percent year-over-year decline as of August, a recent CommercialEdge office report shows. The metro maintained its spot as leader for asking rents; in addition, all Northeastern markets recorded asking rents above the national average of $32.78 per square foot. Manhattan’s vacancy rate stood at 16.6 percent, registering an 80-basis-point drop over a 12-month period.

Earlier this month, fintech company Ramp signed a 132,000-square-foot, long-term lease at 28 & 40 W. 23rd St., a 561,000-square-foot office complex in Manhattan. The firm extended and expanded its presence at the two-building campus owned by Williams Equities.

The post GFP Real Estate Secures New Lease in Manhattan appeared first on Commercial Property Executive.

Primark has signed a 78,760-square-foot lease with Vornado Realty Trust at 150 W. 34th St., in the Penn District. The deal marks the Ireland-based fashion retailer’s first Manhattan store.

Currently occupied by Old Navy, the location will house Primark starting next year, with the opening slated for 2026, Women’s Wear Daily reported.

Vornado purchased the asset for $322 million back in 2015. Last year, the three-story retail center became subject to a $75 million loan provided by Morgan Stanley, according to CommercialEdge information.

READ ALSO: Shopping Changed Dramatically. Retail Design Is One Step Ahead.

Located in the Herald Square, the building is within walking distance of Penn Station and near several other Vornado properties, adding to the company’s high street retail portfolio in the district.

Vornado recently announced that its 52 percent-owned street retail joint venture agreed to sell a portion of Uniqlo’s U.S. flagship store at 666 Fifth Ave., in Midtown Manhattan, for $350 million. Net proceeds were utilized to partially pay down Vornado’s $390 million preferred equity stake in the asset.

Primark’s U.S. expansion

Primark Herald Square will be the company’s 11th store in the state of New York.

Later this year, Primark will open an outlet in Queens. The firm leased 54,562 square feet of multi-level space at Queens Center, in the borough’s Elmhurst neighborhood, in 2023.

Primark opened its first U.S. store in 2015 in the Burnham Building, part of the Millennium tower development in downtown Boston. Now the company operates 27 outlets in 11 states and will soon enter Texas with the inauguration of a new store in McAllen.

High demand for retail space in Manhattan

Manhattan’s retail market remained resilient in the second quarter of this year, driven by ongoing leasing activities and tenant expansions, alongside limited supply in prime areas.

The availability rate remained unchanged from the previous quarter at 14.1 percent—marking the lowest level in nine years—according to a Cushman & Wakefield report. Due to limited availability and high demand in prime Manhattan retail areas, asking rents rose for the seventh straight quarter, increasing 8.1 percent year-over-year.

The post Vornado Adds Fashion Retailer to Manhattan Tenant Roster appeared first on Commercial Property Executive.

Harvey, which specializes in AI for law firms and other professional service providers, initially leased the fifth floor of the building only this year. Now the firm has taken the seventh floor as well.

The building owner, Columbia Property Trust, has undertaken a series of tech and operational upgrades to the vintage 1910 structure, earning it Energy Star, Fitwel, LEED Gold, and WiredScore Platinum certifications. 315 Park Ave. S. also received the Building Owners & Managers Association of New York’s 2022 Pinnacle Award for Operating Building of the Year.

From its Midtown location, the building provides transit access and walkability to Madison Square Park, Gramercy Park and various food options, hotels and shopping.

Other tenants at the 332,000-square-foot building include a range of tech and finance firms, including PitchBook and Twitch. The building’s retail spaces are currently occupied by Just Salad, fitness chain Equinox and the robot-using vegan food purveyor Kernel.

READ ALSO: AI Will Probably Boost Office Demand. And CRE at Large.

Founded about two years ago, Harvey recently completed its Series C investment, which was led by Google Ventures, with participation from OpenAI, Kleiner Perkins, Sequoia Capital, Elad Gil and SV Angel. 

The $100 million investment puts Harvey at a $1.5 billion valuation, enabling the company to continue expanding across business functions and geographies. Harvey has also recently expanded its physical footprint in London, to support its customer base in Europe.

Columbia Property Trust was represented in-house in the deal by Maria Blake and Ted Koltis, along with a Newmark team of David Falk, Peter Shimkin and Jonathan Fanuzzi. Harvey was represented by JLL’s Todd Stracci, Hugh Scott and Jack Nelson.

AI driving otherwise lackluster leasing

Tech leasing has been sluggish in recent years, but a bright spot for office landlords looking to lease to tech companies is the increasing employment by burgeoning AI companies, according to the CBRE’s 2024 Scoring Tech Talent report.

AI’s share of total U.S. tech talent job postings increased to 14.3 percent in June 2024, up from 8.8 percent just before the pandemic in late 2019, CBRE reported, citing Lightcast data. AI roles accounted for 72 percent of all new tech talent jobs in 2023. As demand for AI workers grows, so does their workspace.

Increased demand for specialized skill sets in AI is fueling tech talent job growth, according to Colin Yasukochi, executive director of CBRE’s Tech Insights Center. The company anticipates more tech hiring to take place into 2025 as companies further adopt AI.

The post Columbia Property Trust Lands Lease Expansion in Manhattan appeared first on Commercial Property Executive.

Law firm Cole Schotz has signed a 61,582-square-foot renewal agreement at Court Plaza, a 335,000-square-foot Class A office building in Hackensack, N.J. The landlord Alfred Sanzari Enterprises had in-house representation.

With a team of more than 180 attorneys, Cole Schotz has been occupying space at the property since 1986.

Court Plaza’s tenant roster also includes Lakeland Bank, Moskowitz Law Group, Pearce Law and First Bergen Title Agency, according to CommercialEdge.

The asset is currently subject to a $35 million loan originated by State Farm Insurance Co. in 2020, with a maturity date set for 2040, the same source shows.

READ ALSO: Top Destinations for Corporate Relocations

Completed in 1984, the six-story building includes eight passenger elevators, floorplates ranging between 12,000 and 56,000 square feet, a fitness center, a cafeteria with indoor and outdoor seating and 1,340 covered parking spots.

Located at 25 Main St. in downtown Hackensack, the property is close to transportation options and has access to Interstate 80. Jersey City, N.J., is 15 miles away, while Newark Liberty International Airport is some 20 miles southwest.

Office lease deals the area

Recent office deals in New Jersey include the 9,624-square-foot lease signed by Biocon Biologics with landlord Kushner Real Estate Group. The tenant will use the space at Bedminster 78 Corp Center to establish its new North American headquarters in Bridgewater, N.J.

In early 2024, Vision Real Estate Partners inked a 22,0000-square-foot lease with accounting and consulting firm Meisel, Tuteur & Lewis PC. The deal included the tenant’s relocation at 105 Eisenhower Parkway, part of a three-building office campus in Roseland, N.J.

The post Alfred Sanzari Lands 62 KSF Renewal in New Jersey appeared first on Commercial Property Executive.

Macquarie Group has opened its new 250,000-square-foot office at 660 Fifth Ave. in Manhattan’s Plaza District.

The global financial services company has relocated its New York City office at Brookfield Properties’ 1.5 million square foot recently renovated building, adding its logo to the city skyline for the first time.

Macquarie worked on design with Architecture Plus Information. The lease was initially signed in 2022; the deal also marks 30 years for the firm’s operations in the U.S.

Macquarie Group occupies seven floors at 660 Fifth Ave. The new workplace features floor-to-ceiling windows, meeting and event rooms, lounges and cafe spaces, access to 25,000 square feet of terrace gardens and an open atrium staircase that connects all floors.

READ ALSO: Why the NYC Office Market Is a Tale of 2 Cities

Brookfield Properties has been the owner of the 39-story building since 2018. The company purchased the majority stake for $1.4 billion from Kushner Cos., according to CommercialEdge.

A revamped office tower in Manhattan

Completed in 1957, the mid-century office building includes floorplates between 24,000 square feet and 78,000 square feet, 20 passenger elevators, covered parking spots and 84,855 square feet of first floor and second floor retail spaces.

The owner implemented a $400 million redevelopment project with Kohn Pedersen Fox as architect, resulting in a new facade with 11- by 19-foot single-pane glass units, the largest ones to be used on an office redevelopment in the city. Additional upgrades include a new lobby and elevators, as well as infrastructure services.

The owner is targeting LEED Gold certification for the base building and interior workplace, while the tower already received a WELL Health-Safety rating in 2022. The property was selected as one of the six inaugural commercial spaces for New York state’s Empire Building Challenge, a program for redesign approaches that focuses on reaching low-carbon retrofits for the city’s high-rise buildings.

Corporate relocations

Manhattan’s office vacancy rate stood at 16.6 percent as of August, marking an 80-basis-point drop year-over-year, according to a recent CommercialEdge office report. The rate was below the 19.4 percent national figure, while asking rates stood at $68.56 per square foot, the highest in the Northeast region.

Recent significant corporate relocations in Manhattan include IBM’s new 270,000-square-foot flagship office. The company signed the 16-year deal in 2022 at One Madison Avenue, a 1.4 million-square-foot office building owned by SL Green. The tenant moved all its New York departments at the property, which will host more than 2,000 of its employees.

In May, HSBC opened its 265,000-square-foot headquarters at The Spiral at Hudson Yards. The bank downsized from a 548,000-square-foot office and will now occupy three floors for the next 20 years at Tishman Speyer’s 66-story tower.

The post Macquarie Opens 250 KSF Manhattan Office appeared first on Commercial Property Executive.

Commercial Property Executive reached out to Sage CEO & President Jonathan Kaufman Iger to discuss how Class A office landlords are adapting to tenants and office users’ evolving expectations.

Sage owns and operates six Class A office buildings in Manhattan totaling more than 3 million square feet. The company’s approach to creating spaces that foster collaboration, productivity and wellbeing is helping redefine the future of urban workspaces in New York City.

READ ALSO: What Makes a Distressed Office Property a Good Investment?

Manhattan’s office market has been through a lot over the past few years. How has demand for Class A office space performed lately?  

Iger: Despite the challenges Manhattan’s office market has faced, we continue to see steady demand for Class A space. High-quality, well-located buildings are still drawing interest, especially from firms that prioritize the long-term productivity and wellbeing of their teams. Tenants are now more selective, seeking environments that support collaboration, wellness and innovation, which is why we’re focusing on designing spaces and curating experiences that align with these evolving needs.

What do Class A office tenants expect today, particularly in terms of amenities and design?

Iger: Today’s Class A tenants expect more than just premium office space—they want a holistic experience that enhances both productivity and employee satisfaction. Location remains key, but proximity to transit hubs, vibrant neighborhoods and lifestyle amenities plays a larger role.

We have introduced Oasis amenities at 437 Madison Ave. and 767 Third Ave., with plans to bring it to 777 Third Ave. next. Fogarty Finger-designed Oasis hosts beautifully designed amenity spaces for dining, meeting, conferencing and socializing. These kinds of amenity spaces, facilitating community and fostering collaboration, have become nonnegotiable in attracting and retaining top talent.

Can you expand on the health-oriented amenities your properties include?

Iger: We’ve made employee (member) wellbeing a cornerstone of our offerings. In addition to our oasis spaces and wellness and fitness partnerships, our property management and member experience ensemble prioritizes meeting with and learning as much as possible about our tenants, which helps us strategically plan programming and curated experiences.

We understand that work-life balance requires dynamic partnerships with innovative organizations to benefit our members. For example, one of our lifestyle services partners, Pumpspotting, offers comprehensive lactation solutions and support systems to Sage members and their families right in the palm of their hands.

Most of your spaces are in iconic buildings. How do you balance maintaining the historic value of your buildings and incorporating modern amenities and smart technology?

Iger: As a 100-year-old family business, Sage is incredibly proud of our unwavering commitment to New York City and we are thrilled to contribute to its vibrant future by enhancing our properties and exploring new opportunities for growth. We offer cutting edge amenity spaces and technology integration, like our new Sage Connected 2.0 app and Sage Passport—which allow members to utilize amenities across the portfolio, regardless of their office location.

Equally, we appreciate the storied history of our buildings. 767 Third Ave., for example, was recently featured in a book about interesting places around New York for its iconic chessboard—known as the world’s largest—on the side of the building. Introduced in 1982, the board mirrors famous games of chess through changing moves.

Can you provide examples of recent renovations or enhancements made to your buildings to meet the changing needs of tenants?

Iger: We regularly look at updates to our properties, not only for tenant satisfaction but also for a more sustainable future. At 437 Madison Ave., Sage has made some recent back-of-house capital upgrades for the property. Ownership has installed a tier four backup generator to support the fire and life safety essential systems, configured with the support of base-building mechanical loads. The installation includes additional capacity to support critical loads for tenants.

Currently, Sage is renovating the base-building central cooling plant, including upgrades to all auxiliary equipment, pumps, motors, valves and building automation controls, to optimize the control capabilities and efficiencies. Ownership is also installing digital steam distribution controls and upgrades, which are projected to reduce overall steam consumption and maximize steam distribution.

A $60 million lobby and plaza arcade capital improvements program and an Oasis amenity space have transformed the tower into an iconic Manhattan property for the most discerning tenants. Featuring state-of-the-art building systems and technology, 437 Madison Ave. is uniquely desirable among Manhattan’s finest office destinations. The Fogarty Finger-designed lobby, arcade and elevator cabs, as well as the MPFP-designed ground level Plaza Garden, and the 15th floor Terrace Garden, make this luxury property not only a classic, but an architectural destination.

To what extent have high interest rates and inflation impacted your leasing strategy?

Iger: A challenging market has made us more dynamic. We needed to innovate not only on tenant and member experience, but also in regard to how we approach future investments. As part of routine portfolio evaluations, we identify options that are highly accretive to Sage and beneficial to the changing landscapes of the communities we serve. We also take care to listen to what prospective tenants are looking for from their offices, options like 24/7 HVAC and ease of access, and tailor our offerings to meet their needs.

Work has forever changed and Sage has redefined the future of the office experience. Sage enriches the lives of people at work by providing beautifully designed spaces, exceptional service and inspiring experiences that elevate and enhance the everyday, so our tenants and members can achieve more. We believe the modern, innovative office complements these new hybrid working patterns—better serving a more dynamic workforce.

What’s your approach toward flexible office environments given the increasing demand for coworking spaces and adaptable office layouts?

Iger: We have long seen collaboration as one of the most important tenets of the modern office space. Our workplace solutions and Oasis spaces are designed with this collaboration and adaptability in mind—hosting an array of private and public spaces, conference rooms and phone booths, to meet the needs of our members. The goal is to ensure that our tenants can remain flexible while still enjoying the premium amenities and locations inherent to our portfolio.

What’s the future of Class A office space in urban core areas of gateway cities like New York City? Do you expect any major shifts over the next few years?

Iger: Class A office space will continue to play a critical role in urban core areas like New York City, but the expectations surrounding these spaces are evolving. Over the next few years, we anticipate greater emphasis on sustainability, flexibility and health-focused design. Tenants will seek out spaces that are not only well-located but also adaptable to hybrid work models and equipped with the latest technologies. In response, landlords must remain agile, continuously updating their offerings to meet the demands of a more discerning and dynamic tenant base.

The post Sage’s CEO on the New Realities of Manhattan’s Office Market appeared first on Commercial Property Executive.

Fintech company Ramp has signed a 132,000-square-foot, long-term lease at Williams Equities’ 28 & 40 W. 23rd St., a 561,000-square-foot office complex in Manhattan.

The deal involved a 66,000-square-foot extension and a 66,000-square-foot expansion. Colliers negotiated on behalf of the ownership, while Cushman & Wakefield represented the tenant.

Last year, Ramp signed a short-term sublease agreement for the second floor of the property, a space previously occupied by Microsoft. Under the new deal, the firm committed to the fourth floor as well. Move-in is already underway, with additional build-outs scheduled.

READ ALSO: Office Finance Freeze Begins Slow Thaw

The two-building property rising six and 12 stories came online in 1911. Designed by Maynicke & Franke, the mid-rises originally included only retail spaces and housed a large Stern Brothers department store.

In 1982, the complex was converted to office use. However, 105,000 square feet still serve as retail space, mostly occupied by The Home Depot. The tenant roster also includes Estée Lauder and Yale KeyExpress, according to CommercialEdge data.

The buildings have floorplans ranging between 25,000 and 66,000 square feet and three passenger elevators. Amenities comprise an indoor atrium and a private penthouse.

Williams Equities has implemented several capital improvements at the property over the last several years, including new lobbies and cooling towers on the roof. The firm recently obtained a $155 million CMBS loan for the buildings and plans to add more features, including a new roof deck.

The complex is in the Flatiron District, close to the Madison Square Park. Empire State Building is roughly 1 mile away.

Colliers Advisor Mac Roos, Principal Andrew Roos, President Michael Cohen and Vice President Jessica Verdi represented Williams Equities. Cushman & Wakefield Vice Chair Michael Mathias and Advisor RJ Johns worked on behalf of Ramp.

Manhattan’s average listing rate drops year-over-year

Manhattan’s office vacancy rate clocked in at 16.6 percent at the end of August, well below the 19.4 percent national average, according to the latest CommercialEdge office report. The market’s average listing rate during the same month was $68.56, marking a 1.5 percent decline year-over-year.

In August, Christie’s signed a 25-year lease renewal for about 400,000 square feet at Rockefeller Center including office space, salerooms, public galleries and warehouses. The auction house moved into the building in 1997.

Other recent deals in the area included Yeshiva University’s commitment at Herald Center for 160,000 square feet. JEMB Realty is the owner of the 250,000-square-foot building.

The post Williams Equities Lands 132 KSF Manhattan Lease appeared first on Commercial Property Executive.

New York-Presbyterian has signed a 10,189-square-foot long-term lease with owner Simone Development Cos. at a 60,000-square-foot medical office building in The Bronx, N.Y. The landlord was self-represented in direct negotiation with the new tenant.

The three-story Class B medical office building is at 2510 Westchester Ave. and features an on-site parking garage. The current owner bought the 1972-built asset in 2009 for $5.5 million, according to CommercialEdge information. The property became subject to a $11 million permanent loan in 2016, provided by Flagstar Bank.

READ ALSO: Getting in the Heads of MOB Tenants

The tenant roster also includes Bronx Wellness Center, Unlimited Care Inc., Bronx Westchester Medical Group and Advanced Urology Centers of New York, among others., according to CommercialEdge data. The tenants cover multiple specialties across diverse healthcare fields, such as sports medicine, orthopedics, physical and chiropractic therapy or behavioral health.

The 1-acre medical office asset is within the Westchester Village neighborhood, close to Westchester Square Station. The property is 10 miles from LaGuardia Airport, 13 miles from Midtown Manhattan and within 19 miles of John F. Kennedy International Airport.

Recent movements in the MOB sector

Earlier this month, Lincoln Property Co. formed a joint venture with partners Blue Arch Capital and LoanCore Capital to own and operate Park Sixty, a Class A medical office building in Manhattan. The 15-story building includes 179,000 square feet of medical office space and 7,000 square feet of retail.

In July, Healthcare Realty Trust Inc. expanded its joint venture with Nuveen Real Estate to $400 million in assets. The company is contributing with eight properties valued at $193 million, while Nuveen will fund 80 percent of that equity value. HRT generated $400 million of proceeds so far in 2024 and expects to increase those gains to more than $1 billion.

The post Simone Development Cos. Inks Long-Term Deal at Bronx MOB appeared first on Commercial Property Executive.

Accounting firm Weaver and Tidwell LLP has significantly expanded its space at PENN 1, Vornado Realty Trust’s recently redeveloped 2.5 million-square-foot office tower on Manhattan’s West Side.

The firm had been occupying 8,000 square feet on a portion of the 32nd floor but will now lease the entire 28th floor, with a long-term agreement for 36,500 square feet.

Weaver, a national accounting and consulting firm that provides audit, tax and advisory services, will consolidate its entire New York City workforce into the new space at PENN 1. That includes workers from Buchbinder Tunick & Co., a firm Weaver merged with earlier this year that had leased the PENN 1 space since 1997.

Vornado has now inked 1.5 million square feet of new leases, renewals and expansions at the 55-story tower since the start of redevelopment of THE PENN DISTRICT, a 10 million-square-foot master planned community that underwent about $750 million in renovations, wrapping up in late 2023.

Other new tenants that signed in recent months include law firm Rolnick Kramer Sadighi, which is taking approximately 5,000 square feet of space on the 34th floor; marketing company Cheil, which is leasing the entire 37th floor, about 37,000 square feet; and LB Pharmaceuticals Inc., a clinical-stage biopharmaceutical company leasing 8,906 square feet at PENN 1.

John Mackel, Weaver CEO and managing partner, said in a prepared statement the firm chose this property to consolidate its New York City team because of its in-building and neighborhood amenities and its location atop North America’s most accessible transit hub. Penn Station is a major mass transit hub with 15 subway lines, Long Island Railroad, New Jersey Transit, PATH and Amtrak converging on the station. Starting in 2027, Metro-North, an additional commuter rail line, will also come into Penn Station.

Newmark Chairman Neil Goldmacher and Associate Director Michael Horn represented Weaver in the transaction. Vornado was represented in-house by Executive Vice President Josh Glick, Vice President Jared Silverman and Director Anthony Cugini.

Major redesign

Vornado invested $450 million into PENN 1 as part of the redesign and repositioning of its buildings in the area above and surrounding Penn Station in Midtown Manhattan. PENN 1 and neighboring PENN 2 now serve as a two-building connected campus in the heart of THE PENN DISTRICT.

The two towers have a combined 4.4 million square feet of office space including 180,000 square feet of amenities. These include The Landing, a full-service restaurant, bar and private dining rooms; a 35,000-square-foot wellness and fitness center; 100,000 square feet of flexible workspace and conference facilities; The Perch, a landscaped rooftop park serviced by an indoor glass pavilion; and a 280-seat Town Hall. Vornado also upgraded the street-level retail and food & beverage offerings.

Other improvements included creating a street-level entrance at PENN 1, which leads directly to Penn Station’s recently renovated Long Island concourse. Vornado added a mix of national and local retailers to the concourse, which was widened and had its ceiling raised. Vornado partnered with the New York City Department of Transportation to replace one-half mile of concrete sidewalks across the district with granite stone pavers and to double the width of the sidewalks.

The post Vornado Lands Long-Term Lease at Manhattan Tower appeared first on Commercial Property Executive.

• 250 Park Ave., Manhattan

Sale Price: $320.2 million

AEW Capital Management sold the 20-story office building totaling 519,783 square feet in Central Midtown to JP Morgan Chase Asset Management. The new ownership acquired the 1924-built asset in partnership with Hines, TheRealDeal reported. JPMorgan was set to acquire the building back in June, as part of its expansion strategy across the Park Avenue area, where the bank is developing its new headquarters. AEW Capital Management was the owner the property, also known as The Postum Building, since 1998. Notable tenants of the LEED Gold-certified property include M&T Bank, Regus and Verus Commercial Real Estate Finance.

• 419 Park Ave. S., Manhattan

Sale Price: $71.2 million

El Ad Group, a member of the Israel-based Tshuva Group of Cos., picked up the 160,114-square-foot office building in Manhattan’s NoMad neighborhood from Walter & Samuels, which owned the asset since 1978. As part of the deal, the buyer assumed a $50 million loan held by Apple Bank for Savings, originated in 2016, totaling $57.5 million. Additionally, El Ad Group also received a $7.5 million bridge loan from a private lender. The 20-story property dates back to 1927 and was last upgraded in 2013. The new owner plans to convert the office asset into residential, with plans calling for some 100 condo units scheduled for delivery in 2026, TheRealDeal reported.

• 219 E. 42nd St., Manhattan

Sale Price: $60.0 million

Alexandria Real Estate Equities sold the 300,000-square-foot office property in Manhattan’s Turtle Bay neighborhood to David Werner Real Estate. The building rises nine stories and is now subject to a $75 million loan held by Northwind Group. The former Pfizer headquarters previously sold for $142 million in 2018, in a deal where Alexandria entered into a five-year leaseback agreement with Pfizer. Now, the property that was acquired with Metro Loft Management as joint venture partner, will be redeveloped and converted into a 29-story multifamily building with up to 660 units, Mann Publications reported.

• 57 Willoughby St., Brooklyn

Sale Price: $48.0 million

Prosper Property Group, as majority owner, acquired the 104,526-square-foot downtown Brooklyn office building from Meadow Partners. The transaction also includes GRA Equities and Zuccarello Zerillo & Co. as the other parties with ownership stakes in the building. Originally completed in 1929, the six-story property became subject to a $31.2 million loan held by Argentic Real Estate Finance. The seller purchased it back in 2017, for$54 million.

• 8 W. 38th St., Manhattan

Sale Price: $35.0 million

Flex office provider Jay Suites picked up the 112,120-square-foot building in Manhattan’s Garment District from the Felder family. The 12-story asset includes 11,500 square feet of retail space and will serve as the buyer’s new conference rental business, that will be located at the property’s third floor. Notable tenants at the building include American Council of Engineering Companies of New York, Axis Enterprises, N&A General Construction and The Dessy Group.

The post Top 5 NYC Office Building Sales—August 2024 appeared first on Commercial Property Executive.

The Shop Workspace will open a new 12,000-square-foot flex office location in Brooklyn, N.Y., at 420 Carroll, a 380,071-square-foot mixed-use development in the Gowanus neighborhood.

The new space will open in early 2025 on the building’s second floor and marks the flex office provider’s third location nationwide. The other two are in Salt Lake City and New Orleans.

The Domain Cos. is the landlord and developer of the $300 million project, which includes a 21-story mixed tower and an adjacent 16-story building. The company broke ground in May 2022, with move-ins expected to begin this fall. The development will also feature 27,000 square feet of retail space. The 360-unit residential project is backed by a $158 million construction loan, originated by Bank OZK, according to CommercialEdge.

READ ALSO: Managing Coworking: Building Brands, Building Experiences

The development team includes FXCollaborative, Alan Mainer Studios as interior designer and the landlord’s affiliate, Good Co., as the broker in charge of residential leasing. The project is expected to reach completion this year.

Coworking opportunities

The Shop Workspace’s upcoming coworking location will include shared common areas, phone booths, a staffed reception space, pet-friendly offices, meeting spaces, conference rooms, mail and business services and an office kitchen, among others.

Preleasing is already underway, with monthly memberships available for part-time and full-time common spaces, private offices, creative studios, day or shared passes or hybrid solutions for future members.

In partnership with Arts Gowanus, The Shop will provide seven studios which will be awarded to local artists through a lottery system, while six Gowanus Mix studios will be available for local businesses at a reduced cost. The collaboration is made possible by the Gowanus Mix zoning and will involve year-long agreements.

The mixed-use project will be close to the Union Street R subway station and within walking distance to downtown Brooklyn. Midtown Manhattan is 6 miles away.

Flex office providers expand in NYC

As of April, Manhattan’s coworking sector totaled nearly 9.5 million square feet, representing 2.5 percent of total leasable office space, the largest out of all gateway markets, according to a CommercialEdge market update. The biggest coworking provider in the borough was WeWork, with operations totaling 4.9 million square feet. Industrious was the second-largest one, with an 875,000-square-foot footprint. The company extended and expanded its lease at 860 Broadway, bringing its footprint at the historic six-story property to 27,630 square feet.

Other deals include Convene’s 22,519-square-foot expansion at Stawski Partners’ 360 Madison Ave., in Midtown Manhattan. The lease brought the company’s footprint to 68,000 square feet at the property.

Back in March, The Malin signed a 20,000-square-foot deal at TF Cornerstone’s 387 Park Ave. S. The new coworking space, dubbed The Malin NoMad, marked the company’s fourth location in New York City.

The post The Shop Workspace to Open Coworking Location in Brooklyn appeared first on Commercial Property Executive.

No dollar amount on the transaction was disclosed. Eastdil Secured acted as exclusive advisor to LoanCore.

The block-through, 15-story property is in the Plaza District at 60th Street between Park and Lexington avenues and near the East Side Medical Corridor.

Park Sixty features 179,000 square feet of medical office space and 7,000 square feet of retail space on the first two floors. In 2018, the building completed a $20 million, Article 28–compliant renovation that included the installation of state-of-the-art infrastructure, including a new rooftop cooling tower; a new lobby; and upgrades to all common areas. Amenities include a 24/7 attended lobby and easy access to the 59th Street subway line.

READ ALSO: MOB Tenants Pay a Premium for These Markets

None of the three companies replied to Commercial Property Executive’s request for additional information.

The building’s website indicates that 99,022 square feet of medical space are currently available, which suggests about a 55 percent vacancy.

Park Sixty was built in 1962, according to information provided by CommercialEdge, which also indicates that the previous owner was LoanCore Capital (REO). A $5 million foreclosure sale is on record for September 2023. An arm’s length sale in January 2015 was reported to be valued at $170 million.

MOB mentality

In July, LoanCore funded an $85 million refinancing loan for a joint venture of Goldman Sachs Urban Investment Group and Triangle Equities, for the first two floors of Terminal Logistics Center, a 300,000-square-foot, five-story industrial condominium in New York City’s Queens borough. Institutional Property Advisors Capital Markets, a division of Marcus & Millichap, arranged the financing.

Elevated interest rates and economic uncertainty have restrained transaction volumes and pricing in the health-care capital markets over the past 12 months, according to a first-half 2024 report from Cushman & Wakefield.

The report states that the significant surge in volume and pricing for medical office building sales between 2020 and early 2022 has slowed, as the macro-economic landscape continues to recover from inflation and subsequent rate hikes.

Still, an absence of the overbuilding seen in other product types has helped to moderate MOB occupancies.

Cushman & Wakefield predicts “growth in transaction activity as the debt and equity markets gain confidence in raising their acquisition targets.”

The post Lincoln Property JV to Own, Operate Manhattan MOB appeared first on Commercial Property Executive.

Ahead of the Federal Open Markets Committee’s pivotal meeting this week, a panel of New York City-based owners and investors in office and retail appeared to be optimistic, yet realistic in assessing their challenges.

At a Sept. 17 discussion, hosted by CBIZ Marks Paneth and called ‘Manhattan to Main Street: Real Estate’s Pulse in New York and the Nation,’ the firm’s own CIO, as well as the CEOs of Rosen Equities and GFP Real Estate, shared thoughts on affairs both local and national. Discussion ranged from sustainability-focused legislation to the viability of office-to-residential conversions.

The economy: Wins and woes

While the Federal Reserve’s imminent interest rate cut is a welcome development, more long-term financing and investment strategies call for level heads. For starters, with a single rate cut, the funds rate will remain at its highest in more than two decades, all the while inflation, though considerably improved, is still above the Fed’s target of 2 percent.

“It is going to be higher, which will keep rates higher,” predicted Anna Rathbun, CBIZ’s CIO. “If you’re an investor, it will not make or break anything, but they are starting a cycle.”

Following a rate cut, both bond ratings and loan maturities are of interest, particularly in the CMBS space, of which $2.2 trillion will expire by 2028. “In terms of stability, bonds are going to be re-rated and potentially written down in certain portfolios,” Rathbun predicted. The result? “A bifurcation of (assets) that are sensitive to them and those that are not.”

READ ALSO: CPE Asks: What Makes a Distressed Office Property a Good Investment?

GFP Real Estate, which owns and operates office properties around New York City, in turn sees any rate relief as doing more for sentiments than it will for high capital costs and cap rates.

“It’s not about what rates are today, but (it’s) that forward curve, and what they are perceived to be,” said Brian Steinwurtzel, GFP’s co-CEO & principal. “We need to execute loans not in this moment, but in three, four, five or seven years.”

The good news? Institutional investors are eagerly anticipating a more certain market. “(There’s) a lot of dry powder waiting for those prices to drop,” according to Rathbun.

Goings-on around town

Investing in and operating Manhattan office properties that are not Hudson Yards or One Vanderbilt remains a risky proposition, but converting obsolete stock is still a promising—if at times difficult to sell—alternative.

“If you buy them cheap enough, you can do almost anything to a building,” reasoned David Koeppel, CEO of Rosen Equities. Still, residential conversions, even for the GFP-owned Flatiron building, have their limitations, particularly where project costs and aesthetics are concerned. As an example, “we can’t economically change the fenestration,” Koeppel said.

Koeppel had the same sentiments for the Big Apple’s ESG compliance laws. “Local laws 97, 88, 132 and 134 are all well-intentioned, but the owners of the buildings don’t use the majority of electricity,” Koeppel noted. In fact, these regulations are a direct discrepancy with the city mulling a mandate for indoor temperatures of residential buildings to not exceed 78 degrees, according to The Real Deal.

One area that panelists saw particularly sticky was the ubiquity of hybrid work, as employees become more enthusiastic about working in-person. “We will reach an equilibrium where working from home is seen as a luxury,” Rathbun weighed in.

The post NYC Executives Stay Sober-Minded on Eve of Expected Rate Cut appeared first on Commercial Property Executive.

The Feil Organization has signed a 15,000-square-foot long-term lease at Garden City Center, a 200,000-square-foot Class A office building in Garden City, N.Y. The tenant is NYSUT, a federation of more than 1,200 local unions. The landlord was represented in-house, while The Paragon Group negotiated on behalf of the tenant.

The deal comes after the ownership’s recent completion of a capital improvement program at the property, led by MdeAS Architects, that resulted in upgraded common areas.

The Feil Organization is the owner of the 1990-built property since its $22 million purchase in 1996, according to CommercialEdge. Other tenants at Garden City Center include Beacon Health Partners, Ameriprise Financial Services, Miller & Milone and Bell Law Group, among others, the same source shows.

A closer look at Garden City Center

The five-story building is at 100 Quentin Roosevelt Blvd. and includes four passenger elevators, one freight elevator, a fitness center, ample column spacing, 36,550-square-foot average floorplates and 800 parking spots. Additional features include a five-story atrium, a conference facility, a full-service restaurant and extensive private and visitor parking services.

The 7-acre office property is close to Interstate 495, as well as four Long Island Railroad stations and to Roosevelt Field Shopping Mall. Garden City Center is 15 miles from Republic Airport, 17 miles from John F. Kennedy International Airport and within 27 miles of Midtown Manhattan.

Co-Founders & Partners Jerry Guerra and Jeffrey Nemshin with The Paragon Group worked on behalf of NYSUT, while Head of Commercial Office Leasing Andrew Wiener and Director of Commercial Leasing Robert Fisher with The Feil Organization represented the landlord.

Back in April, the landlord signed a renewal for 12,617 square feet with an architecture firm at The Gramercy Park Building, its 226,000-square-foot property in Manhattan’s Flatiron District. During the same period, George Comfort & Sons landed a 20-year lease for more than 330,000 square feet at 63 Madison Ave. in Manhattan’s Gramercy Park.

The post The Feil Organization Inks Long Island Office Lease appeared first on Commercial Property Executive.

The city’s leasing activity exceeded 1.4 million square feet of space out of a total of 4.3 million square feet that came under contract across the world’s 15 largest legal markets.

The report also found that the flight-to-quality trend continues to raise the price premiums of best-in-class law office assets worldwide, and particularly in the U.S., as top-tier space becomes harder to secure.

Overall, 23 percent of practices globally look to expand their space and 44 percent maintain their existing footprint.

According to Savills, U.S. cities accounted for 69 percent of legal leasing activity in the world’s largest markets. This reflects the dominance of American firms in the sector overall and the tendency for U.S. legal offices to have a lower occupancy density, thereby requiring more space.

Fewer legacy meeting rooms

One example is that firms are moving away from legacy meeting room booking systems to intelligent solutions that select rooms based on attendance by in-person and remote attendees, easing pressures on meeting rooms.

Mark Leonard, principal & senior vice president of Lee & Associates, L.A. North/Ventura told Commercial Property Executive that the practice of law has been a continuous growth industry, which is positive news in this slow office industry.

“Despite many lawyers working on the road much of the time, the need for privacy is still a requirement, and therefore, the continued demand for private offices versus shared environments remains a growth aspect of this industry,” Leonard said.

READ ALSO: Tenants Are Leasing More Office Space in Prime Buildings

“I continue to see the need for a few collaborative areas on the floor and a very ‘friendly’ kitchen/lunchroom environment. Law firms also open satellite offices to support the demand and growth.

Pierre Debbas, co-founder of Romer Debbas, told CPE that while most small and large firms have embraced some level of the hybrid model, an attractive office is still important to recruit talent.

“As an owner of a law firm, I can attest to the fact that in-person collaboration and training are imperative to managing a law practice,” he said. “This sentiment indicates the legal industry being at the forefront of the office leasing market.”

Firms may be re-envisioning how they maximize their square footage, but the need for office space for the legal industry is “unquestioned,” he added.

Cost-efficient space, first impressions

Tere Blanca, founder, chairman & CEO of Blanca Commercial Real Estate, told CPE that law firms have slowly shifted toward a hybrid work model, investing in more cost-efficient and integrated office spaces that foster collaboration and teamwork while optimizing the office space instead of larger office footprints.

“Law firms have become more strategic in navigating the costs of office spaces,” she said. “Instead of relying on large offices with expansive conference rooms that often end up unused, they are designing multipurpose spaces that allow firms to optimize their space while enforcing the collaborative aspect fundamental to law practice.”

From a design perspective, first impressions are still top of mind for the legal industry, according to Tiffany Scharpf, a design director and senior associate based in IA Interior Architect’s San Francisco studio.

She told CPE that sustainability in finish materials and construction helps firms demonstrate they “put their money where their mouth is.”

“On the West Coast, we still see very few in-office mandates. While hoteling is rare, some firms are exploring this to reduce their footprint,” she said.

Larger offices look to get smaller

Edith Gonzalez, managing director of legal services at JLL Work Dynamics, told CPE that JLL found in its Law Firm Perspective report earlier this summer that larger law firms in the market remain focused on space efficiency.

She said 79 percent of firms with a current footprint of more than 100,000 square feet are seeking space reductions—by an average of 31 percent. In contrast, smaller firms show a mixed trend, with as many looking to expand their space as looking to reduce their space.

READ ALSO: Manhattan Office Visits Up Year-Over-Year

“Law firms are evaluating workplace design decisions on a sliding scale and exploring more progressive strategies, such as hoteling, while continuing to implement baseline industry-standard practices, such as single-sized offices,” Gonzalez said.

According to Gonzalez, law firm lease rollovers will peak in 2027. “Over the next five years, more than 30 million square feet of law firm leases are expiring in the nine markets reported. Given the reduction in new construction, these firms will face a significantly diminished development pipeline and limited options for high-quality large-block availabilities,” she added.

In Chicago’s CBD, there has been strong office leasing activity among smaller law firms. However, the sweet spot for these users—around 10,000 square feet—can be hard to come by,” Justin Kessler, managing director of tenant representation practice at Bradford Allen, told CPE.

Only about one-third of available office space in Chicago can accommodate users of that size, and only about 12 percent of available sublease space is less than 25,000 square feet, according to Kessler.

While rents held steady in the second quarter, “many law firms are finding that there are some great options in the market right now, whether they’re moving from Class C to B buildings or from B to A,” Kessler said.

“In many metros, including Chicago, these smaller deals drive much of the leasing activity,” continued Kessler. “To capitalize on the demand, some landlords are building spec law suites that reflect the latest design preferences. Most law firms still want private offices and conference rooms to maintain confidentiality. Still, they’re also gravitating to spaces that include communal work and gathering areas, exposed ceilings, and glass partitions that create separation while making spaces feel lighter and more modern.”

The post New York City Tops the Charts for Legal Sector Leasing appeared first on Commercial Property Executive.

During a career in New York City real estate that has spanned nearly 70 years, Larry Silverstein has been a leading figure in shaping the city’s skyline.

In a discussion coinciding with the publication of The Rising, a memoir detailing the two-plus-decade long rebuilding of the World Trade Center, Silverstein Properties’ founder expressed pride in what’s been achieved at the site and optimism about the city’s future. The Q&A session took place two days before the anniversary of the Sept. 11, 2001, terrorist attacks.

Five of the Lower Manhattan campus’ planned seven buildings are now complete and 97 percent leased. The development remains one of the Big Apple’s largest hubs of commerce, arts and culture.

“I’ve lost my sense of objectivity,” Silverstein said at the discussion, which took place Monday at 7 World Trade Center, the first tower to be rebuilt after the terrorist attack. “As I look out the window and I see what we’ve accomplished, (I think) we’ve done a reasonably good job,” Silverstein added.

Bullish near the bull’s domain

The process of building new towers, memorializing those lost and revitalizing the area has brought epic challenges. Over the decades, they have ranged from replacing a destroyed Con Edison electric substation to a five-year battle with 22 separate insurance companies over more than $4 billion worth of payouts for the destroyed buildings and infrastructure. Even now, an anchor tenant is yet to be determined for the planned 2 World Trade Center.

Another challenge is that at the time of its rebuilding, the neighborhood was having an identity crisis. Two decades ago, it was still regarded as mostly the domain of stockbrokers and office workers, with many concerns about the area’s safety following the attacks.

“At that time, if you came there on a Saturday or Sunday, you could roll a bowling ball down Wall Street,” Silverstein recalled. Those issues were compounded by the submarket’s aging office stock, much of which dated to the 1970s and 1980s. The pandemic and subsequent rise of the hybrid work model are adding to the challenges. “These buildings today no longer have the needs of their occupants,” Silverstein noted.

READ ALSO: Manhattan Office Visits Up Year-Over-Year: REBNY

In Silverstein’s view, developers have two options. Either build out easily accessible, aesthetically and functionally appealing office spaces, or convert existing stock to residential. Silverstein happens to be engaging in both acts. Last year, the firm bought 55 Broad St., a 30-story office tower built in 1967, with plans to develop more than 500 apartments. As for what that bowling alley looks like now, “the area between Broad and Water streets is residential,” Silverstein detailed.

Remembering the roots

When asked about the city’s political climate and struggles with housing costs, Silverstein’s reply mirrored much of his responses to the struggles with rebuilding: New York City can tackle any hardship, be it a financial crisis, pandemic or terror attack, and that a worthy goal is more important than having enough capital or agreeable partners to help one achieve it.

“I’ve been here all my life, working since (1956). It’s given me an opportunity to work my tail off. If (the city) did not provide those opportunities to me, I would have had a totally different life,” Silverstein said.

The post Larry Silverstein Talks Rebuilding, Resilience at the World Trade Center appeared first on Commercial Property Executive.

IBM has opened its 270,000-square-foot flagship office at One Madison Avenue, a 1.4 million-square-foot building in Manhattan. Based in Armonk, N.Y., the Fortune 100 firm signed the 16-year, five-floor lease in 2022.

IBM is moving all its New York-area departments to One Madison Avenue, which will house more than 2,000 of its employees. Full occupancy is slated for next month.

Designed by Gensler, IBM’s space features a 300-person auditorium, a 25,000-square-foot rooftop terrace and a bar, as well as a separate, expansive street-level lobby. Additionally, the company will use a 22,000 square-foot Innovation Studio, alongside individual and collaboration areas.

The news came on the heels of IBM’s lease for 320,000 square feet at Cousins Properties’ Domain 12 building in Austin, Texas. The company will assume Meta Platform’s existing commitment starting January 2026.

One Madison Avenue, up close

SL Green acquired the office tower in 2005 for $801.7 million. In May 2020, the National Pension Service of Korea and Hines purchased a 49.5 percent stake in the property for $493 million. Later, in December 2021, SL Green sold an additional 25 percent interest in the building to a foreign investor.

The Class A, 27-story building came online in 1893 and was completely renovated last year, according to CommercialEdge. The project also involved extending the space by 500,000 square feet.

READ ALSO: Office Finance Freeze Begins Slow Thaw

The ownership took out a $1.3 billion construction loan in 2020 and a $575 million note in 2022 from Wells Fargo Bank for this endeavor. Kohn Pedersen Fox Associates designed the $2.3 billion redevelopment, while AECOM Tishman Construction served as general contractor.

Amenities now include a barista coffee bar, an event space and rooftop garden dubbed Le Jardin sur Madison, a 6,200-square-foot interior lounge and an outdoor terrace, as well as nearly 1.3 acres of outdoor space and bike storage. The tower also has a four-level, 60,000-square-foot fitness center.

The proposed LEED Gold-certified building is at 1 Madison Ave., less than 1 mile from the Empire State Building and 2 miles from Rockefeller Center.

Manhattan’s office market improves

Manhattan’s office vacancy rate clocked in at 16.6 percent as of July, down 90 basis points year-over-year, according to the latest CommercialEdge office report. The rate was also 1.5 percent below the national average. Additionally, the market’s listing rate during the same month was $71.34, more than double the U.S. figure.

In July, CBRE extended its approximately 180,000-square-foot lease at 200 Park Ave. in Manhattan. The brokerage firm also took over the duties of leasing, property and asset management at Irvine Co.’s tower.

Earlier this year, HSBC opened its headquarters at The Spiral at Hudson Yards. The company will occupy 265,000 square feet at Tishman Speyer’s 66-story office for 20 years.

The post IBM Opens Manhattan Flagship Office appeared first on Commercial Property Executive.

Convene has signed a 72,000-square-foot lease at 30 Hudson Yards, the 101-story Class A+ office tower in Manhattan. CBRE brokered the deal on behalf of both parties.

The skyscraper has multiple owners, including Time Warner Inc., which owns 1.5 million square feet, KKR, Wells Fargo Securities, DNB, Oxford Properties Group and Related Cos. All ownership partners have offices at the property.

Convene will fully occupy the 24th floor at the 2.6 million-square-foot high-rise, where it will open a new experiential event venue. The hospitality and flex office brand also leased 2,770 square feet of retail space at the ground-floor level, which will serve as a dedicated lobby and welcoming area.

READ ALSO: Tenants Are Leasing More Office Space in Prime Buildings

Dubbed Convene 30 Hudson Yards, the event space will include 10 customable venues configured to serve multiple functions, a grand hall with the capacity of up to 780 guests and a gallery. The location will have the capacity to host nearly 1,500 guests and is set to open next summer.

A Midtown skyscraper

Rising at 500 W. 33rd St., 30 Hudson Yards came online in 2019. The skyscraper features 30 passenger elevators and floorplates ranging between 30,000 and 70,000 square feet, according to CommercialEdge. Kohn Pedersen Fox Associates designed the 1,296-foot tower, which was the second-tallest building in New York City at the time of its topping out in 2018.

Amenities include outdoor terraces and direct access to the subway lines. The LEED Gold-certified property is home to The Edge, an outdoor observation deck, and to the City Climb at Edge, an outdoor staircase allowing visitors to ascend to the top floor. The skyscraper is in Midtown Manhattan and 30 miles from John F. Kennedy International Airport.

CBRE Executive Vice President Rocco Laginestra represented Convene while Chairman Robert Alexander negotiated on behalf of the landlord. In addition, Senior Associate Elliot Karp and Senior Vice President Stephen Winter with Related Cos. represented the ownership.

The post Related Cos. Inks 72 KSF Manhattan Lease appeared first on Commercial Property Executive.

The demand for traditional office environments is shifting, leading to significant impacts on vacancy rates, lease structures and development activity. As companies are looking for ways to right-size their portfolios and office spaces, the market’s current outlook is showing some improvement. Office attendance is now closer to pre-pandemic levels, and some companies have found the right formula for increasing leasing rates.

In the first episode of Step Into My Office, CPE’s new quarterly podcast series, Associate Editor Olivia Bunescu delves into the current office market trends across New York with Nick Berger, director of commercial leasing at The Moinian Group. Berger shares some of the company’s leasing strategies as it adapts to changing tenants’ needs and hybrid work models.

LISTEN TO: RICS Monitor: Is the Worst Behind Us?

Here’s what he discussed about:

• Major trends across NYC’s office landscape (01:04)
• Financial and legal services are leading the office market (02:05)
• “The office market is a bit better than the start of the pandemic, but it’s not quite where we want it to be.” (03:13)
• How have office lease terms changed across the office market? (04:34)
• Accommodating tenants’ expectations as part of leasing strategies (05:50)
• Competition for tenancy is an ongoing challenge in the office sector (07:23)
• Approaching leasing from a customer-centric standpoint (09:17)
• NYC’s scene is set up for improvement, but there’s a long way to go (11:35)
• How proximity to major transportation hubs and quality attracts tenants (12:55)
• The Moinian Group’s formula for portfolio growth and leasing success (14:38)
• Keeping a closer look at the Grand Central area (17:24)
• Embracing conversions as an expansion strategy (19:30)
• The inspiration behind The Moinian’s Mile (20:44)
• What’s next for NYC’s office scene? (22:52)

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The post Step Into My Office: Taking a Closer Look at NYC’s Office Landscape appeared first on Commercial Property Executive.

One day after Labor Day, and the unofficial end to summer, REBNY issued its latest monthly analysis of Placer.ai location data in 350 Manhattan office buildings for July. For the full month, Manhattan office buildings had an average visitation rate of 72 percent of the 2019 levels. The first week of July had only 55 percent visitation rates. When the week of the Fourth of July holiday was excluded, the data showed the final three weeks of July had an average visitation rate of 78 percent, 1 percentage point higher than June’s average of 77 percent. June had set a post-pandemic record.

The Placer.ai report tracks mobile data of office tenants and their employees. It also reflects office visitors and retail customers and employees within buildings with retail space. The properties analyzed include a representative sample of various types of office buildings. Those that were not completed by 2019 were not factored into the report or in the 2023 average visitation rates.

A national report by Placer.ai also found office visits in June were continuing an upward climb back to pre-pandemic levels with visits down 29.4 percent compared to June 2019. In that survey, Miami fared the best with its visits down by 9.8 percent compared to June 2019. The national report stated New York City visits were down 14.2 percent.

“October is the next key month to look at as it will not include any significant holiday weeks. We are curious to see if visitations will reach a new peak then,” Keith DeCoster, vice president of research at REBNY, told Commercial Property Executive.

DeCoster said when the Fourth of July week was excluded, Manhattan office buildings maintained June’s momentum. He noted that newly constructed or renovated properties, as well as some Class B buildings with prime access to transit, continued to outperform.

READ ALSO: Here’s a Surprising Shift in Remote Work’s Appeal

The report found average building visitations in the highest quality Class A+ buildings reached 86 percent in July, down from 91 percent in June, but up 9 percentage points year-over-year. Class A/A- visitations declined by 4 percentage points from June to 71 percent, but were well above the 63 percent level recorded in July 2023. Class B and C buildings included in the survey saw a month-over-month decline from 75 percent to 69 percent as of July, while being up 1 percent year-over-year.

There has been steady improvement throughout the year at Manhattan office assets. Data showed there were 15.2 million total device visits in July, a 10 percent increase over the 13.9 million total device visits in July 2023.

“Even though it may not always feel like it, the COVID-19 pandemic was quite some time ago. It’s becoming more the norm for occupiers to expect office workers to come in three to four times a week,” DeCoster told CPE. “While there was substantial progress in visitation rates through 2023, during the first half of the year, return-to-office policies were still not as defined.”

A recent survey from CBRE found about 80 percent of organizations have a return-to-office policy, but only 17 percent actively enforce it. Despite the low enforcement rate, one-third of corporate real estate executives told CBRE they wanted more in-office attendance.

Markets vary as Midtown rules

The report breaks Manhattan down into three submarkets—Midtown, Midtown South and Downtown. All three submarkets were up year-over-year but down 5 to 6 percentage points from the June average. Midtown buildings tracked by Placer.ai continued to attract the highest average visitations, reaching 75 percent of pre-pandemic baselines in July.

The Midtown rate was just above Midtown South’s July visitation rate of 72 percent and well above Downtown’s visitation rate of 64 percent. It was the fifth straight month Midtown has had the highest rate.

In Midtown, the average July visitation rate was up from 69 percent the previous year. In Midtown South, the average July visitation rate was down from 78 percent in June but up from 67 percent in July 2023. Although there was a dip from 69 percent in June to 64 percent in July for Downtown, the average visitation rate was up from 58 percent in July 2023.

Asked about the Lower Downtown average visitation rates, DeCoster acknowledged there were fewer A+ buildings in that submarket than in Midtown and Midtown South. But he said there are “some that are performing great” in Downtown Manhattan.

“A more significant issue for downtown visitation rates is distance to regional transportation hubs like Grand Central and Penn Station,” DeCoster said.

The post Manhattan Office Visits Up Year-Over-Year: REBNY appeared first on Commercial Property Executive.

Cosmetics company e.l.f. Beauty has inked a 10-year office lease at Meysar Realty Corp.’s 16 W. 22nd St., a 165,000-square-foot office building in Manhattan. The firm has been occupying 13,000 square feet at the property since 2020, and has now extended to 39,000 square feet. GFP Real Estate and Cushman & Wakefield represented the landlord and the tenant, respectively.  

Free Agency and Rebecca Minkoff previously occupied the additional 26,000 square feet. The cosmetics firm will utilize the space to further grow its business and focus on global expansion. Earlier this year, e.l.f. Beauty opened its first European office in London, and in 2023, it paid $355 million to acquire Naturium, a skincare brand.

READ ALSO: Why the NYC Office Market Is a Tale of 2 Cities

William Harvey Birkmire is the designer of the steel and masonry office building. Rising 12 stories, 16 W. 22nd St. came online in 1910 and its lobby went through a renovation process in 2003. Features include 13,500-square-foot floorplates, 12-foot ceiling heights, 10-foot column spacing and a floor load of 100 pounds per square foot. A restaurant duo occupies the ground floor.

The mid-rise building is in Manhattan’s Flatiron District. The property’s close to 257 Park Ave. S., the Feil Organization’s 226,000-square-foot The Gramercy Park Building, where PEI Architects signed a 12,617-square-foot lease renewal in April.

GFP Real Estate Senior Managing Director Barbara Yagoda represented Meysar Realty Corp., while Cushman & Wakefield Executive Director Jonathan Schindler spearheaded leasing efforts on behalf of e.l.f. Beauty.

Manhattan office leasing activity reaches seven-quarter high

A total of 6.3 million square feet of office space had been leased across Manhattan in the second quarter of 2024, a recent Cushman & Wakefield report shows, marking the first time in seven quarters when the figure surpassed 6 million.

Despite the leasing momentum, Manhattan’s office vacancy rate keeps rising. Cushman & Wakefield placed the availability rate at 23.6 percent as of June, showing a 120-basis-point increase year-over-year.  

Not all office properties are affected the same, as a CBRE study identified a performance gap between asset classes. The analysis pinpoints a more exclusive denomination than the usual Class A, which was dubbed prime office space.  

The post Cosmetics Company Triples Manhattan Office Presence appeared first on Commercial Property Executive.

• 2 Times Square, Manhattan

Sale Price: $99.3 million

South Korea-based Bando Engineering & Construction purchased the 26,992-square-foot retail property in Manhattan’s Theatre District from Sherwood Equities. The acquisition was financed by a $60 million loan with KEB Hana Bank as lender. The new owners, which purchased the basement through second-floor spaces at the property, plans to introduce Korean cultural elements at the retail asset, according to Yonhap News Agency.

• 719 7th Ave., Manhattan

Sale Price: $32.5 million

Boich Investment Group acquired the 7,887-square-foot retail property in Times Square from SL Green. VerCap Management provided acquisition financing totaling $23 million in the form of an amended and restated note. The billboard retail building last traded in 2014 for approximately $21 million, when SL Green picked it up through multiple transactions with 11 different entities.

• 40 Broad St., Manhattan

Sale Price: $18 million

Albert Allaham, the owner of Reserve Cut, purchased a 6,379-square-foot retail condo unit at 40 Broad St., together with a 7,903-square-foot unit at 40 Broad St. and a 24,148-square-foot unit at 40 Broad St.. The property changed hands from a private individual and serves as the home of the buyer’s kosher steakhouse in the Financial District. The 1982-built retail asset is subject to a $11.7 million acquisition loan provided by Webster Bank.

• 300 E. 23rd St. #C, Manhattan

Sale Price: $11.4 million

A legal entity affiliated with LNR Partners purchased the 10,622-square-foot retail unit of the 19-story condominium building at 300 E. 23rd St. The seller of the condominium and retail property, totaling 144,784 square feet and known as the Tempo Residential Tower, was The Feil Organization. The Gramercy Park property was originally built in 2008 and in 2014 became subject to a $12 million loan held by U.S. Bank Trust. The remaining debt was assigned to LNR Partners.

• 200 E. 83rd St. #COMM, Manhattan

Sale Price: $8.6 million

Madrin-based Azora Group, through its real estate investment arm Azora Exon, acquired the 5,751-square-foot retail portion of Naftali Group’s condominium tower at 200 E. 83rd St. The Yorkville property is totaling 205,877 square feet and rises 35 stories. Naftali Group developed the residential tower in 2021, in joint venture with Rockefeller Group.

The post Top 5 NYC Retail Building Sales—July 2024 appeared first on Commercial Property Executive.

Bromley Cos. acquired 122 Fifth in 1979, marking the company’s first NYC purchase. When, after decades of being headquartered at the location, Barnes & Noble opted to relocate, Bromley Cos. decided to renovate the entire property. This was in 2019. Two years later, the Landmarks Preservation Commission (LPC) approved the developer’s proposals to transform the 11-story building from top to bottom.

The initial goal was to modernize the interior of the structure completely, but without damaging the historical integrity of the exterior. “We also wanted to make the building more efficient, operationally and functionally,” Chris MacArthur, vice president of operations at Bromley Cos., told Commercial Property Executive.

During the architect interview process, it became clear that the entrance should be moved off of Fifth, a view also embraced by the selected architects—STUDIOS Architecture. One idea led to another, which was that they needed to expand into the adjacent parking lot to achieve a larger contiguous space. Today, following a $100 million investment, 122 Fifth encompasses 300,000 square feet, with 18,000 square feet of retail, office plates ranging from 27,000 to 33,000 square feet and nearly 15,000 square feet of rooftop terraces and gardens.

“At its core, this project was a complete rebirth of a building,” explained Roy Vice, senior vice president of construction and development at Bromley Cos.

Even as the exterior was being preserved, the interior was effectively undergoing a ground-up job, introducing all new mechanical and electrical systems. This complex overhaul of 112 Fifth brought it once again into the spotlight and turned on the natural light inside it.

READ ALSO: The Impact of NYC’s 1st Climate Budgeting Initiative: A Skanska Exec’s View

“As a T-shaped building with limited façades on Fifth Avenue, 17th and 18th streets, and a core sitting at the center of the main spine, there wasn’t too much light getting deep into the building,” said Tomás Quijada, associate principal at Studios Architecture. “By removing the core from the old building and shifting it into a central yet discreet portion of the new building, light can penetrate deeper into the floorplate and provide an easier direct visual connection to sunlight as well,” he explained.

With this reimagining of the core strategy, the architects were able to uncover some windows that were boarded up on the light well, providing additional light at the crux of the T-shaped building.

STUDIOS Architecture played a pivotal role in 122 Fifth’s redesign, serving as the main draftsman and spearheading several innovative contributions, MacArthur confessed. Their solutions are the result of the architects pushing Bromley to “think differently about the opportunities inherent in rethinking the entire property.”

One such example is the decision to build out the new lot and move the core entirely out of the old building into the new one. Another is consolidating the elevators into the new addition, a decision which opened up the plannable tenant areas, improving flexibility and filling them with light, fit features for the tenancy in the market.

The annexation of the new building to the original structure unfolded seamlessly and occurred across two plans: outside and inside. On the exterior, STUDIOS searched far and wide for a blend of bricks that matched the old and a material that aligned with the historic limestone elements. Also, the rooftop terrace and building addition create a common space for the old and the new buildings, all while complying with LPC requirements.

On the interior, the former exterior window openings were expanded to become passageways between the old and the new structures. In addition, the interior finishes are consistent and the floor levels are maintained, so the transition between the two eras is smooth.

“The new lounge-like lobby, situated in the new building expansion, continues the neutral palette of the façade, featuring a dark metal fin feature wall, in front of which sits a monolithic bronze finished reception desk,” described Quijada.

Another notable design element was the introduction of a new canopy, which harkens back to the building’s turn of the century roots, according to Vice. STUDIOS Architecture also reduced the size of the pavilion, thereby creating more outdoor space for tenants to enjoy.

Enhanced tenant experience

The building at 122 Fifth Ave. has various amenities focused on the holistic needs of modern employees. On the ground floor, there is a bike room with spa-inspired bathrooms for those health-conscious tenants who choose to commute to work and need to freshen up before heading to their office. The top floor features a pavilion with room for employees to work while taking in stunning views of the city.

In fact, the location itself is a prized amenity. Situated in Union Square, 122 Fifth embodies the concept of a five-minute-city, where essential services and amenities are within a short walk. “This prime location is a significant contributor to both LEED and Fitwel certifications, as it provides excellent access to public transit, making commuting easy and reducing reliance on personal vehicles,” shared MacArthur.

Inside the building, the size and speed of the elevators paired with advanced technology ensure efficient vertical transportation and easy navigation throughout.

“The floorplan is designed for optimal layout and ease of movement, contributing to a seamless experience for tenants,” said Bromley. The lobby sets a modern and professional tone from the outset and stands out among other buildings through key features like “a bespoke scent,” he added.

The latest technology in heating and HVAC systems provides consistent and comfortable indoor climate control. Moreover, integrated security systems, including elevator access control, boost safety.

Enhanced energy efficiency

During the final phases of 122 Fifth’s renovation, the owner implemented Nantum AI, a piece of software sometimes referred to as the “brain within the building,” which gathers data from IoT sensors over the points of entry/exit in the building lobby. This helps to know when the building is occupied and at what capacity, therefore certain parameters can be modified to address the occupancy conditions at all times. Simply put, when the tenant leaves, it decreases the air system, which in turn saves energy, carbon emissions and dollars, explained MacArthur.

“The system uses comprehensive alerting features to notify the building team and the Nantum AI team if certain conditions are outside of an acceptable range,” said Amit Paul, vice president of smart buildings at Nantum AI. It helps the owners “find their building’s sweet spot” and calibrate algorithms as needed, such as being less aggressive on energy savings and focusing more on occupant comfort.

Nantum AI is integrated directly with the building automation system (BAS), which enables it to capture real-time data from the BAS using the building’s existing sensor network. Then, it uses this data and other real-time data points to generate recommendations to optimize building energy consumption and provide operators with insights on operational anomalies with their building equipment.

READ ALSO: Beyond Aesthetics: Prioritizing Well-Being in Workplace Design

The implementation of Nantum AI provided increased energy efficiency, which weighted heavily in the U.S. Green Building Council’s decision to award 122 Fifth a LEED Gold certification. Additional sustainable features include separate water retention systems that help to efficiently manage and recycle rainwater. Green roofs not only contribute to reducing the urban heat island effect but also provide extra insulation and green spaces, while the inclusion of a bike room promotes environmentally friendly transportation and a healthier lifestyle.

The development team used green construction practices, such as low VOC materials, and ensured proper disposal during demolition. These not only minimize the environmental impact but they also enhance indoor air quality, which is further improved by advanced air filtration systems. In addition, they’ve used locally sourced materials, which reduced transportation emissions and supported the local economy.

When drawing the renovation plans, Bromley Cos. also targeted Fitwel certification, which they are presently expecting. “You could see this in the new design—shifting the focus to user satisfaction and enjoyment—which was not the original intent of the building upon construction in the early 1900s, or even in its ulterior renovation,” shared MacArthur.

Bumps in the road

The renovation process at 122 Fifth was far from dull, as several significant challenges tested the development team’s adaptability and perseverance.

First, much of the construction occurred during the COVID-19 pandemic, when the city was effectively shut down, recalls Vice. This led to numerous supply chain problems, which ultimately necessitated sourcing alternative materials and solutions while keeping an eye on the quality of the finished product. Furthermore, while the renovation was underway, Bromley was also accommodating an anchor tenant’s buildout, which required coordination and planning to minimize disruptions, he added.  

Additionally, working on a 120-year-old building was not without surprises, as during construction, the development team discovered many undocumented modifications performed over the years. Many of these required on-the-spot problem-solving and flexibility, Vice said. As beautiful as it is, the building’s cast iron frame with numerous arches further complicated the renovation due to its intricate and challenging structure.

The tech side had its share of tricky trials. When the Nantum AI team got to work, the building’s design and construction had not yet been finalized, said Paul. “In a few cases, hardware had to be installed with flexibility in mind in case the design changed,” he recalled.

The cherry on top of 122 Fifth

When asked about what they enjoyed most about the 122 Fifth renovation project, Quijada named the vertical construction for the penthouse space, “with its incredible views of the Empire State Building and Hudson Yards.” Also, building on an empty lot, no matter how small, was a unique opportunity in this area of the city, he added.

Vice’s favorite aspects of this project are the lobby and its artwork, as well as the rooftop. “Both set new standards for Lower Fifth Avenue,” he said, adding that the lobby’s design creates a powerful first impression with its modern, welcoming ambiance. But the rooftop is particularly remarkable, featuring unique artwork in an outdoor setting. Finally, the decision to take the building slightly off the avenue while retaining its prestigious address combines a sense of exclusivity with prime location benefits.

The post 122 Fifth: Inside the Rebirth of a Manhattan Landmark appeared first on Commercial Property Executive.

Auction house Christie’s has inked a 25-year lease renewal at Rockefeller Center for office space, salerooms, public galleries and warehouses in the famed Midtown Manhattan office and retail city-within-the-city. The London-based Christie’s U.S. headquarters occupies about 400,000 square feet at 20 Rockefeller Plaza. Christie’s originally moved to Rockefeller Center in 1997, when it signed a 30-year lease.

The auction house’s decision validates the recent renovation of Rockefeller Center, Tishman Speyer CEO Rob Speyer said in prepared remarks. The work on the complex is slated to wrap up late this year.

Among other renovations, Tishman Speyer opened up the lower-level passageways surrounding the property’s well-known skating rink to stimulate pedestrian flow. The rink level is now also home to three marquee restaurants, NARO, Jupiter and 5 Acres, which join Le Rock and others.

READ ALSO: Why the NYC Office Market Is a Tale of 2 Cities

Tishman Speyer also added to the complex’s retail offerings through local establishments, including Catbird, McNally Jackson and Todd Snyder, along with global brands such as Alo Yoga, Tiffany & Co. and Lego. High above the plaza level, the three-level Top of The Rock observation deck was also redeveloped.

CBRE’s Mary Ann Tighe, Ramneek Rikhy, Cara Chayet and Courtney Hughson represented Christie’s, along with Jen Yashar and Danielle Frank of Fried Frank. Landlord Tishman Speyer’s team was led by E.B. Kelly and was represented in-house by Blythe Kinsler and by Charlie Mileski of Davis & Gilbert.

A win for Midtown

The deal represents a positive development for Midtown Manhattan, especially the office market, which hasn’t fully recovered from the pandemic, though there has been improvement in the volume of leasing.

Demand for office space was up in the second quarter of 2024, with tenants taking 4.4 million square feet, up 25 percent quarter-over-quarter and 41.1 percent year-over-year, according to Colliers. Rents eked out a 0.1 percent gain, but were down 1 percent from a year ago.

Few recent leases are on the scale of Christie’s. However, in May, Bloomberg bested the deal by taking 946,800 square feet in a renewal at 731 Lexington Ave.

The post Christie’s Renews 400 KSF Manhattan Lease appeared first on Commercial Property Executive.

Yeshiva University signed a 32-year lease that will expand its footprint with a new 160,000-square-foot space at Herald Center, an office building in Midtown Manhattan. JEMB Realty owns the Class A property. Savills negotiated on behalf of the tenant, while the landlord was represented in-house.

Yeshiva University will occupy partially mezzanine and ground-floor spaces at Herald Center, as well as the building’s floors five through nine. Other tenants at the property include ASA College, The Joint Industry Board of the Electrical Industry, Bank of America and H&M, according to CommercialEdge.

The university will use the space to establish a new campus to expand its presence in the Health Sciences field. YU recently launched graduate programs, such as the Nursing program, expected to open this fall, and Occupational Therapy and Speech-Language Pathology programs, which are part of the university’s Katz School of Science and Health.

READ ALSO: Manhattan Office Market Still Sluggish

The 10-story Herald Center is at 1311 Broadway and encompasses 250,000 square feet. Originally completed in 1902 as a retail building, the property was converted to office use in 2015 and features eight passenger elevators, 30,028-square-foot floorplates and 12,016 square feet of retail space, CommercialEdge shows.

The current ownership picked up the asset in 1986 and repositioned it through a $50 million capital improvement program. As a result, the building became the home of the largest H&M store in the world, with a 63,000-square-foot footprint.

The mid-rise property is at the corner of 34th Street and Broadway, within the densely populated area of Herald Square. The location provides easy access to multiple bus and subway stops, while being 3 miles from Lower Manhattan, 8 miles from Washington Heights and within 15 miles of John F. Kennedy International Airport.

Savills Vice Chairman of the Nonprofit Practice Group David Carlos worked on behalf of Yeshiva University, while the landlord was represented in-house by Principal Jacob Jerome and Chairman of the Board Morris Bailey.

Big deals in Midtown Manhattan

Manhattan’s office vacancy rate reached 16.6 percent in June, a recent CommercialEdge report shows. The rate was down 60 basis points and below the 18.1 percent U.S. figure. Meanwhile, asking rents showed an average of $71.34 per square foot, more than double when compared to the national average of $31.67 per square foot.

Recent office leases signed in Midtown Manhattan include CBRE’s extension and expansion of its 180,000-square-foot lease at The MetLife Building, the 3.1 million-square-foot skyscraper owned by Irvine Co. The company has been a tenant at the office tower for 36 years and will continue its stay until 2037.

Also in July, Silverstein Properties closed two deals at 1177 Avenue of the Americas. The agreements total 58,500 square feet and involve the relocation and expansion of law firm Faegre Drinker Biddle & Reath LLP and the relocation of the Trustees of Columbia University’s offices.

The post University Signs 160 KSF Lease in Midtown Manhattan appeared first on Commercial Property Executive.

The demand dichotomy in NYC’s office market is starker than in other large U.S. metros. While prime office space is seeing robust activity, lower-tier buildings lag, constantly pushing landlords to find solutions.

Class B and C office landlords are struggling with high vacancy rates as tenants are mainly searching for trophy and Class A spaces to boost their return-to-office efforts.

Meanwhile, locations near transportation hubs like Grand Central Station continue to attract high levels of interest due to their convenience, according to Joseph Gervino, principal in Avison Young’s New York City office.

In the interview below, Gervino and James Nelson, principal & head of Avison Young’s Tri-State Investment Sales group, reveal what they’ve noticed in this top U.S. market, drawing an ample picture of NYC’s office landscape today.

READ ALSO: Tenants Are Leasing More Office Space in Prime Buildings

How has the recent economic uncertainty impacted the NYC office market so far?

Gervino: Recent economic uncertainty has led to longer transaction times, with some tenants adopting a wait-and-see strategy before making decisions. However, leasing activity through the second quarter of 2024 is up 18.7 percent—14.6 million square feet—from the same time last year, so there is forward momentum in the market.

How weak exactly has transaction activity been? Are there any particular types of office buildings that investors are favoring?

Nelson: There were 10 office sales in Manhattan in the second quarter of the year for a combined $873 million. The most significant being Bloomberg’s acquisition of 980 Madison Ave. for $560 million. End users purchasing their own buildings has been driving the market.

Investors are most interested in buildings that are well leased and located. Otherwise, they are also seeking those with potential for residential conversion. There are also speculators who are looking for ‘cheap bricks’ or great opportunities for redevelopment, as the purchase of 529 Fifth Ave. at under $400 per square footage.

In what ways does the NYC office market stand out from the rest of the country?

Nelson: Office is trading at massive discounts to pre-COVID-19 levels. They can be incredibly challenging to finance, but a contrarian investor could be rewarded if the return-to-office improves. New York City is outpacing the rest of the U.S. in that regard. As of June 2024, office buildings across the U.S. are 61.9 percent as busy as they were in June 2019. Office buildings in Manhattan, however, are 76.6 percent as busy as they were in June 2019—putting Manhattan significantly above the U.S. average in terms of return-to-office efforts.

READ ALSO: How Capital Market Curveballs Are Shaping NYC

However, landlords and tenants face a lot of challenges. What are the top issues they’re dealing with today?

Gervino: Tenants are relocating to high-end space to encourage employees to return to the office on a more consistent basis. Therefore, there is a significant increase in demand for Class A and trophy assets and lack of supply, which creates pressure on tenants trying to secure new office space to help their return-to-work efforts.

There is a large supply of commodity space available—Class B and C buildings—putting pressure on landlords to do whatever they can to keep tenancy and attract new tenants. Often, this means increasing concession packages, lowering rent and investing in the building—renovations, adding amenities etc.—to compete with higher-quality spaces. Currently, Class B and C availability sits at 19.9 percent, slightly above the overall availability for Manhattan, which is at 19.6 percent.

Please expand on how the remote/hybrid work trend has affected demand for office space in the metro.

Gervino: The NYC office market is really a tale of two cities: It’s trophy and Class A vs. everything else. Top-tier assets are in high demand and year-to-date, 78.2 percent of transaction activity by square footage has been signed in trophy and Class A properties. Tenants are relocating to high-end space so they can attract and retain quality talent and offer incentive to their employees to come to work in the office on a regular basis. This flight-to-quality has created strong demand in high-end assets, whereas Class B and C buildings are struggling to retain and attract new tenancy.

Where do you think opportunities lie in the NYC office market right now?

Gervino: Although there is strong demand for high-end space, NYC is still a tenant-friendly market. Tenants searching for Class B and C product are in a very strong position to take advantage of current conditions.

What other types of offices are businesses seeking today?

Gervino: Amenities and flexibility are key in attracting/retaining tenancy in today’s market. I recently represented a tenant who refused to look at buildings that did not have a strong amenity program along with coworking/flex office providers in the building.

Flexibility and optionality in lease terms—renewal, expansion, termination—are also important factors in deals today. Some tenants are taking a more cautious approach to long-term leasing. However, they are still seeking large concession packages. By providing growth, renewal and termination options, flexible landlords can attract tenants.

The post Why the NYC Office Market Is a Tale of 2 Cities appeared first on Commercial Property Executive.

DSV Global Transport and Logistics has signed a full-building, 355,000-square-foot lease at Crow Holdings’ 1.2 million-square-foot industrial campus in Carteret, N.J. Cushman & Wakefield brokered the deal on behalf of both parties.

Denmark-based DSV is the second tenant that Crow Holdings added to the roster, bringing the campus closer to the 50 percent occupancy mark.

The owner signed its first tenant last year, when Hong Kong-based Weida Freight System committed to 188,000 square feet.

READ ALSO: Cracks Show in Port Industrial Markets

According to an interim financial report for 2024’s second quarter, DSV expects air and sea markets to grow by 3 to 4 percent this year, while road is slated for a flat or low-growth scenario. DSV Solutions North America President Josh Summers stated in prepared remarks that the new lease more than doubles the firm’s footprint in the region.

Crow Holdings at Carteret comprises three facilities. The DSV-leased building features 40-foot clear heights, 164 car parking spaces, 35 trailer parking spaces, 50 dock doors and two drive-ins. The bay size is 54 by 54 feet, and the speed bay measures 65 feet. The transport and logistics company plans to expand the building’s office space and specialized fit-outs, including 100,000 square feet of cooler capacity.

Located at 300 Salt Meadow Road, the facility is less than 1 mile from New Jersey Turnpike Exit 12, some 8 miles from the Newark Airport and roughly 13 miles from Port Newark-Elizabeth.

Cushman & Wakefield Vice Chairs Jules Nissim and Stan Danzig alongside Senior Director Kimberly Bach represented Crow Holdings, while Vice Chair Mindy Lissner brokered on behalf of DSV.

A brownfield redevelopment

Crow Holdings Development completed the campus’ construction last year. The land had been previously used as industrial waste storage. In 2012, the 126-acre site underwent remediation, having been declared a landfill reclamation district by Carteret.

Crow Holdings acquired the development site for $87 million. For its role in revitalizing the parcel, the firm received a 30-year, $135 million PILOT financing for its newly debuted property.

New Jersey’s industrial vacancy rate grows

New Jersey industrial demand remained solid throughout 2024’s second quarter, with a leasing volume of 6.7 million square feet, according to a report by Cushman & Wakefield. The amount marked a 24.9 percent increase year-over-year.

However, the area’s vacancy rate stood at 7.1 percent in June, up 540 basis points from June 2022. Meanwhile, industrial deliveries clocked in at 7.7 million square feet year-to-date through June, which led to a negative absorption of 3 million square feet during the same period, the report reveals.

Last month, China-based JW Fulfillment Inc. signed a 342,371-square-foot, full-building lease at Trammell Crow Co.’s Arsenal Trade Center, a 1 million-square-foot logistics center in Sayreville, N.J.

The post Crow Holdings Lands 2nd Tenant at New Jersey Campus appeared first on Commercial Property Executive.

As a global financial hub, New York City is a barometer for the health of the commercial real estate finance market and domestic and foreign investor appetites as well.

To explore how New York City’s CRE landscape has shifted due to recent capital market conditions, Commercial Property Executive turned to Peter Carillo, principal at HKS Real Estate Advisors. The firm focuses on investment sales and capital markets advisory.

In this interview, Carillo discusses how current finance and investment complexities are playing out in the Big Apple and how investors are adjusting their strategies.

READ ALSO: Deal-Thirsty Investors Are Still Waiting for CRE Distress

How have recent dynamics and economic events shaped investment trends in the New York City market?

Carillo: The New York City commercial real estate capital markets are navigating significant volatility and transformation due to current economic factors and market dynamics.

One of the most pivotal influences has been the Federal Reserve’s monetary policy. The consistent high interest rates have led to higher borrowing costs, impacting the liquidity available in the market. This tightening monetary policy aims to curb inflation but has simultaneously increased the cost of capital, thereby making financing more expensive for real estate transactions.

In addition, investment sales in New York City have witnessed a slowdown over the past year, largely influenced by uncertainty surrounding federal rate cuts. This hesitancy among investors reflects broader concerns about the economic outlook and the strategic recalibration of investment portfolios. 

With lenders adopting a more conservative stance, securing debt has become increasingly challenging. The underwriting standards have tightened, and lenders are more diligent in assessing risk. This cautious approach has led to a reduction in loan-to-value ratios and an increase in interest rate spreads, further squeezing the margins for investors and developers. 

Despite these challenges, there are abundant opportunities, particularly in the realm of distressed assets. Investors with ready access to capital are well positioned to acquire undervalued properties, particularly those facing financial difficulties due to the current economic climate. This trend underscores a strategic shift toward value-add investments where investors can enhance property value through active management and repositioning.    

Are you observing a notable shift between debt and equity financing?

Carillo: Yes, as interest rates rise and economic uncertainties increase, investors are shifting from debt to equity financing to mitigate borrowing costs and enhance financial flexibility. This shift is influencing deal structures by leading to higher equity stakes, more joint ventures and partnerships and a focus on longer-term investments. These changes aim to reduce financial risk and emphasize sustainable returns in a volatile market.   

For instance, there is a notable preference for joint ventures where investors can share both risk and reward and for projects with longer timelines to avoid high refinancing costs. Historically, such shifts have been observed during similar economic climates to maintain stability and flexibility.

With interest rates on hold for the past 12 months, how has the cost and availability of debt changed?

Carillo: With high interest rates holding steady for over a year, the cost of borrowing has risen significantly, making loans more expensive for property investors and developers. Moreover, lenders have become more stringent with their credit standards, resulting in fewer real estate projects qualifying for loans.

Those that do qualify often receive smaller loan amounts or less favorable terms. As a result, commercial real estate investors are finding it more challenging to secure the necessary funding for their ventures, prompting a more cautious and strategic approach to investments.  

READ ALSO: CRE Experts See Opportunities Ahead

In light of those shifts, how are investors adjusting their risk-return profiles?

Carillo: Investors are adjusting their risk-return profiles by shifting capital allocation towards more stable and predictable asset classes, targeting properties with strong fundamentals and long-term leases. 

For instance, in New York City, the industrial sector continues to attract significant investment due to the rising demand for logistics and warehousing space. Additionally, the multifamily sector and specifically the unregulated market units remain resilient and is experiencing sustained interest as rental demand continues to be strong.

Retail properties, particularly those that can adapt to experiential and mixed-use formats, are also drawing interest. These shifts reflect investors’ efforts to balance risk and return.      

What trends are emerging regarding loan-to-value ratios or debt service coverage ratios?

Carillo: Investors are seeing a tightening of loan-to-value ratios as lenders become more cautious amid economic uncertainties and rising interest rates. Higher equity requirements are being implemented, reflecting a more conservative approach to financing. This adjustment aims to mitigate risk and ensure that borrowers have a substantial stake in their investments.

There is also an increased focus on debt service coverage ratios, with lenders demanding higher debt-service coverage ratios to ensure that borrowers have sufficient income to cover debt obligations. This trend underscores a cautious stance toward underwriting, as higher DSCRs provide a buffer against potential cash flow fluctuations and economic volatility.

How are institutional investors altering their approach to commercial real estate investments?

Institutional investors are adapting by emphasizing more robust financial metrics and risk management strategies. They are increasingly seeking stable, income-producing assets with strong fundamentals, often favoring properties that offer consistent returns and lower volatility. Additionally, there is growing interest in alternative financing structures and joint ventures to balance risk and leverage opportunities in the commercial real estate sector.

How are investors managing inflation risk, and what role does global capital flow play in shaping the New York City market?

Carillo: In the face of rising inflation, investors are actively managing risk through various strategies, including diversifying their portfolios across different asset classes and geographic regions, focusing on value-add investments to enhance property income potential and securing long-term debt with fixed interest rates to lock in borrowing costs. 

Additionally, global capital flow plays a significant role in shaping the New York City market, with international investors often viewing New York City as a safe haven during economic uncertainty. This influx of foreign capital not only helps stabilize the market but also drives up property values, creating a competitive environment that influences local investment strategies and trends.

Looking ahead, what is your outlook for the New York City capital markets over the next 12 to 24 months?

Carillo: In the next 12 to 24 months, the commercial real estate capital markets are poised for a period of opportunity. While investment volumes might experience some fluctuations and market uncertainties, there is a promising outlook as the economic environment stabilizes. The slight increase in deal flow is a positive sign, and the anticipated interest rate cuts in the latter half of 2024 could improve market conditions and boost investment activity.

While deal volumes and yields may face some pressure in the next 12 to 24 months, investors are likely to remain optimistic as they anticipate clearer signals on rate adjustments and economic stability. Additionally, we expect 2025 to be a very active year for the market.

Any final thoughts?

Carillo: The New York City commercial real estate market is navigating volatility and transformation. Investors are shifting toward equity financing and distressed properties despite challenges from the political climate and anti-landlord policies. However, the city’s history of resilience suggests it will endure, with anticipated interest rate cuts and an active 2025 likely to boost market conditions.

The post Q&A: How Capital Market Curveballs Are Shaping NYC appeared first on Commercial Property Executive.

StubHub has signed a sublease totaling approximately 100,000 square feet at 4 World Trade Center in Manhattan. Silverstein Properties owns the 2.5 million-square-foot tower.

Savills facilitated the sublease at this prime office space, which allows StubHub to immediately take possession of one floor in the location. Additionally, Savills negotiated an agreement with the sublessor to enable StubHub to take over two more floors later.

Built in 2013, the Class A, 72-floor building was last subject to a $1.4 billion loan, provided by the Port Authority of New York and New Jersey in 2021 and a previous financing in 2011 of $1.2 billion originated by Bank of New York Mellon, CommercialEdge shows. The property’s tenant roster includes Duolingo, Digital Asset, Media Math and Rippling, among others.

The Savills team that represent StubHub included Scott Bogetti, corporate managing director at Savills, Executive Managing Director Kirill Azovtsev and Managing Director Michael Bertini. Vice Chairman Brad Wolk and Associate Director Will Joumas, who are part of the Savills Integrated Consulting Strategies group, were also part of the Savills team. The sublessor was represented by Vice Chair Sheena Gohil of Colliers.

Availability for sublet in Manhattan

The move showed StubHub’s continued growth at the corporate level, having outgrown its most recent lease. In March 2023, the company signed for 44,000 square feet to establish its headquarters at 3 World Trade Center, also owned by Silverstein Properties.

“The amount of space available for sublet in New York City is at an all-time high,” Pierre Debbas of Romer Debbas LLP, told Commercial Property Executive.

Manhattan’s vacancy rate clocked in at 16.6 percent as of June, down 60 basis points over a 12-month period and stood lower than the 18.1 percent national rate, a recent CommercialEdge report shows.

“There are certainly deals to be had in the sublease market. Having a major company like Stubhub take on 100,000 square feet with an option to take on two additional floors in the future is a great sign for the office leasing market and hopefully a trend that continues,” Debbas added.

The post StubHub Upsizes Office Space at World Trade Center appeared first on Commercial Property Executive.

The Japanese clothing company will buy 17,295 square feet of its 90,732-square-foot store, while Vornado’s joint venture will continue to own the 23,832 square feet occupied by Abercrombie & Fitch and Tissot stores at the location.

Eastdil Secured provided advisory services to Vornado’s street retail joint venture. The sale is expected to close by the first quarter of 2025, pending customary closing conditions and Uniqlo’s separate transaction with the office condominium owner.

The expected $340 million in net proceeds from the sale will be utilized to partially pay down Vornado’s $390 million preferred equity stake in the asset. When the transaction is finalized, the pass-through leases between the office condominium owner and the retail joint venture will come to an end.

Last year, Vornado Realty Trust entered into an agreement to sell four downtown Manhattan retail buildings, encompassing 123,000 square feet. The company also sold a fifth retail asset in a separate deal, with the total sales price for both transactions amounting to $124.4 million.

Manhattan’s retail scene

The Manhattan retail market remained resilient in the second quarter of the year due to steady new leasing activity and tenant expansion requirements. The retail availability rate held steady at the previous quarter’s 14.1 percent, the lowest rate in nine years, according to a recent Cushman & Wakefield report.

Availability along Lower Fifth Avenue, between 42nd and 49th streets, dropped to 14.8 percent, the lowest rate since 2012. The largest lease in the area was for GU, Uniqlo’s sister brand, securing 24,330 square feet at 510 Fifth Avenue, the same source shows.

The post Vornado Sells Manhattan Retail Space for $350M appeared first on Commercial Property Executive.

Leasing has begun for 125 West 57th St. in Midtown Manhattan, a 260,000-square-foot tower with ground-floor retail and approximately 180,000 square feet of full-floor Class A office space, featuring direct Central Park views and private outdoor spaces.

Developed by partners Alchemy-ABR Investment Partners and Cain International along the residential corridor of the iconic Billionaires’ Row, the property is the only planned, ground-up Class A trophy office building going up on spec for the Plaza District within the next few years, at a time when there is limited new product being delivered to the office market.

Designed by FXCollaborative, the 30-story, 420-foot-tall glass tower is accentuated by vertical, bronze-colored fins. JLL exclusively handles leasing for the building, and office tenant buildouts can start as early as the third quarter of 2024, with a temporary certificate of occupancy expected for the first quarter of 2025.

Focus on health, well-being, knowledge-sharing

The mixed-use project’s Class A boutique office component will fill a gap in a pandemic-shaped market driven by the experiential office space, focused on health and well-being. Upon completion, the building will be one of the few centrally located Class A offices in the Plaza District.

Peter Miscovich, Global Future of Work Leader at JLL Consulting, who co-authored the book “The Workplace You Need Now,” told Commercial Property Executive that “experiential offices and experiential workplaces foster greater employee engagement and satisfaction by providing stimulating, interactive and immersive work environments that cater to the physical, cognitive and emotional needs of employees.”

READ ALSO: Tenants Are Leasing More Office Space in Prime Buildings

“These environments promote creativity, collaboration and knowledge-sharing by enabling serendipitous interactions, facilitating cross-functional teamwork and encouraging the exchange of ideas through thoughtfully designed spaces and amenities,” he added.

The building is targeting LEED Gold certification.

Miscovich said an experiential office and workplace can also serve as a powerful talent attraction and retention strategy, as they signal an organization’s commitment to employee well-being and offer a unique and compelling work experience that appeals to both current and prospective employees.

“By blending elements of hospitality, technology, and activity-based work, this environment can increase productivity, efficiency and innovation by enabling employees to choose the most appropriate work settings for their tasks and work styles,” he said.

“An experiential approach to the workplace can also contribute to an organization’s broader sustainability and wellness goals by promoting physical activity, healthy behaviors and a sense of community, all of which can positively impact employee health, work-life balance and overall well-being.”

Pierre Debbas, Esq., co-founder of Romer Debbas LLP, told CPE, “This is a very interesting project and demonstrates the optimism in Class A office space. Unfortunately, the same optimism does not apply to Class B and C buildings. While few are developing office space in NYC, creating an experiential modern space will serve well for the current demand in a post-pandemic world.”

For JLL, Mitchell Konsker, Christine Colley, Dan Turkewitz, Kristen Morgan, Kate Roush are handling leasing.

Alchemy-ABR and Cain bring decades of commercial, hospitality and residential expertise to 125 West 57th St. Alchemy-ABR recently sold out The Woolworth Tower Residences, which transformed the top floors of the iconic Woolworth Building into luxury residences, in addition to the recent development of high-end residential condos on the Upper West Side, including 378 West End Ave., and 250 W. 81st St.

The post Billionaires’ Row Experiential Office Tower Nears Completion appeared first on Commercial Property Executive.

A joint venture between two New York City-based real estate investment firms—Lloyd Goldman’s BLDG Management Co. Inc. and David Werner Real Estate Investment—has acquired 100 Wall St., a 29-story Manhattan office building from Barings for $116 million.

Northwind Group, a Manhattan-based real estate private equity firm and debt fund manager, provided the buyers with a 10-year, $95 million senior mortgage acquisition loan for the 518,405-square-foot tower in the Financial District. Built in 1969 and completely renovated in 2013, the building also has 7,500 square feet of ground-floor retail space and an 8,232-square-foot showroom.

Barings, the investment arm of insurance firm MassMutual, purchased the building in August 2015 from Savanna for $270 million, according to CommercialEdge data. The Real Deal reported Barings was initially seeking $125 million for the asset when a Newmark team led by Adam Spies and Josh King began marketing it in the spring. Savanna, through its Savanna Real Estate Fund II LP, had acquired 100 Wall Street in May 2011 from Lehman Brothers Holdings as part of a foreclosure auction for $118.1 million, assuming $125 million in existing debt.

READ ALSO: Tenants Are Leasing More Office Space in Prime Buildings

Although the multi-tenant building is about 83 percent leased, there is potential for an office-to-residential conversion, according to Northwind Group. A New York City zoning rule, which has spurred many conversion projects in the Financial District, allows commercial buildings constructed before 1977 to go full residential.

Two current office-to-residential projects underway in FiDi include 55 Broad St., which is being transformed into 571 market-rate apartments by Silverstein Properties and Metro Loft Management. GFP Real Estate, Metro Loft Management and Rockwood Capital are redeveloping 25 Water St. from a 22-story office building into a 32-story residential tower with about 1,300 rental units.

Current tenants

FedEx and Verizon are among the retail tenants. Current office tenants at 100 Wall St. include Octavian Capital Partners, Aleutian Capital Group, Integra Partners, National Bank of Pakistan, Harris Beach Attorneys at Law, DMG Investments, Rosenbaum & Rosenbaum, Godosky & Gentile, The Hanover Insurance Co., Foster Garvey, PRC and Aflac, according to CommercialEdge data.

The building has 19,700-square-foot floorplates and good light and air on all sides. Amenities include a fitness center. The transit-oriented tower, which is LEED Certified Silver, is within a quarter mile of two subway stations.

Northwind deals

Since the beginning of the year, Northwind has closed more than $650 million in loans across New York City and other major gateway markets. Founded in 2007 by Ran Eliasaf, the firm has $2.2 billion in assets under management and invests primarily in debt instruments through closed-end debt funds. In March, Northwind provided a $65 million first-mortgage senior acquisition loan to 601W Cos. which purchased Harborside 5, a 1 million-square-foot office tower in Jersey City, N.J., from Veris Residential.

Northwind was represented by John Vavas of Polsinelli Law Firm in the 100 Wall St. deal.

The post NYC Office Tower Commands $116M appeared first on Commercial Property Executive.