This Week’s N.Y. Deal Sheet
Leasing picked up in New York City this week, while some negotiations on some of the city’s final 421-a developments added to sales and financing activity in the pipeline.
TOP LEASES
SL Green has signed Swedish private equity firm EQT Partners to 76K SF at 245 Park Ave. for a 15-year term, the REIT announced. Real estate-focused global alternative investment manager Angelo Gordon has also signed for an 11K SF expansion, bringing its total footprint to 149K SF in the building. Cushman & Wakefield’s Ethan Silverstein and Michael Movshovich represented EQT, while Newmark’s David Falk and Peter Shimkin repped Angelo Gordon. SL Green acquired full ownership of the 1.8M SF, 44-story property from HNA Group in September last year following a lengthy arbitration process, and told The Real Deal at the time that it saw the tower as its “next major development project,” akin to One Vanderbilt and One Madison. It's looking to sell a stake in the project to shore up its balance sheet.
***
Rudin’s 3 Times Square has signed West Publishing Corp., a unit of Thomson Reuters that produces an array of products geared to the legal, business and regulatory communities and includes Westlaw, to a 46K SF, five-year lease extension in the 30-story tower. Rudin and Reuters are finalizing a massive redevelopment of the tower and have signed tenants including Rémy Cointreau, Anchin, Block & Anchin and Touro University. The extension brings the landlords' leasing activity since December 2021 at the 885K SF tower to 431K SF. A JLL team of Mitchell Konsker, Dan Turkewitz and Christine Tong represented West Publishing Corp. in the deal.
***
Securitas Security Services USA has signed a 20K SF lease at 498 Seventh Ave., according to a release. The 25-story building, owned through a partnership between George Comfort & Sons, Loeb Partners Realty and JR AMC, spans 960K SF and is a stone’s throw from Penn Station. The security company agreed to a 10-year lease in the building, joining neighbors like engineering firm Cosentini Associates, construction specialists Milrose Consultants and design and construction firm The McKissack Group, bringing occupancy to 96%. Renovations brought new entrances to the property, connecting its Seventh Avenue, 37th Street and 36th Street entrances with a through-block lobby and refreshing the retail storefronts. The deal was hammered out in-house for George Comfort & Sons by Andrew Conrad and Matt Coudert, while CBRE’s David Opper and Eddie Sisca repped Securitas.
***
Tower 40, Madison International Realty and Joseph P. Day Realty Corp.’s 48-story office building at 10 East 40th St., has signed several tenants totaling 47K SF in new leases. The 442K SF art deco Bryant Park tower is being refitted to attract office tenants, with new features including a full lobby makeover, common corridor renovations and creating pre-built suites with city views. Architecture firm Hart Howerton has renewed and expanded to take up 27K SF across the 37th through 39th floors of the property, while investment firm Alpha Square Group has signed for 9K SF on the 35th floor. An unnamed multinational tire manufacturer signed for 7K SF on the 41st floor, while luxury Italian fashion house Missoni signed for 4K SF on the building’s penthouse. Hart Howerton was repped by CBRE’s Alexander Ryan and Tim Freydberg, Alpha Square Group by Cushman & Wakefield’s Evan Algier and Stephan Langton, and Missoni by Cushman & Wakefield’s Diego Rodino di Miglione. Cushman & Wakefield’s Ethan Silverstein, Theodora Livadiotis and Caroline Collins repped the landlords in the deals.
***
Arcade Songs has signed a 19K SF lease at 60 Charlton St., a boutique office building owned by a joint venture of AEW Capital Management, Drake Street Partners and AFP Properties. Asking rents were in the $90s per SF for the 12-year lease covering the second and fourth floors of the building, where Arcade Songs plans to create a full-service recording and writing studio, according to a release. The music publisher will move from 587 Fifth Ave. for the Hudson Square office property, where ownership removed the third floor to double the ceiling heights of the second floor. The property’s redevelopment also saw the building’s original architectural details restored, added six new stories to bring the building’s total square footage to 98K SF, and created a brick and glass curtain wall around the full 12 stories. A JLL team including Mitchell Konsker, Benjamin Bass, Kristen Morgan, Carlee Palmer and Harrison Potter represented building ownership, while CBRE’s Alex D’Amario and Gary Davies repped the tenant.
***
Lee & Associates NYC has signed a sublease agreement with the Royal Bank of Canada for 18K SF at 1211 Sixth Ave., Ivanhoé Cambridge’s 45-story Midtown Manhattan office tower, which is anchored by Fox Corp and News Corp, Crain’s New York Business reported. The 3.5-year sublease agreement was brokered by Greg Herman, David Mosler, Dale Schlathler and Bruce Mosler of Cushman & Wakefield on behalf of the Royal Bank of Canada.
TOP SALES
Sotheby’s is buying the Breuer Building at 945 Madison Ave. for roughly $100M, The New York Times first reported. The property, owned by the Whitney Museum of American Art, is currently occupied by the Frick Collection, which is due to leave next year, after which time Sotheby’s will move its headquarters from its current 1334 York Ave. address. The five-story, building, built in 1966, was designed by Hungarian-American architect Marcel Breuer to house the Whitney, which moved to a $422M property at 99 Gansevoort St. in the Meatpacking District in 2015. The Metropolitan Museum of Art signed a lease at 945 Madison Ave. after the Whitney moved, giving it eight years in the Breuer Building, but began subleasing to the Frick Collection in 2018. The Frick has used the space as a temporary location for its collection while it renovates its permanent home, 1 East 70th St. Sotheby’s plans to move into the brutalist building in 2025, Commercial Observer reported.
***
The Carlyle Group has purchased a majority stake in Property Markets Group’s two-tower, 517-unit Gowanus Canal luxury development, The Real Deal first reported. Carlyle paid $100M for the property, Crain’s New York Business reported. PMG originally purchased the site at 276 Bond St. for $9M in 2021, the same year the New York City Council approved the neighborhood’s rezoning. The two towers are currently under construction, with 25% of all units set aside as affordable housing under the 421-a program, and do not yet have their certificates of occupancy.
TOP FINANCING DEALS
A joint venture of Argo Real Estate and bSafal has scored an $84M construction loan for its already-underway Greenwich Village condo project at 64 University Place, according to a release. The sum comes from Deutsche Bank and Naftali Credit Partners, a subsidiary of Naftali Group. The joint venture plans to build an 11-story property, due for completion in 2024, with 28 residential condos and ground-floor retail space. Deutsche Bank provided the senior loan, while Naftali Credit Partners provided mezzanine financing. The $84M total will be used to refinance the development’s existing debt and complete construction.
***
United Construction and Development Group has secured a $40M acquisition loan for a Rego Park development site, where it plans to build 706 residential units across three towers, Commercial Observer reported. The 140K SF site at 93-30 93rd St. offers an additional 670K buildable SF, which will allow the developer to add 200K SF of commercial space to the mixed-use multifamily project as well as 806 parking spaces. United acquired the site in March from Vornado for roughly $70M. The $40M financing came from Maxim Capital Group in a deal arranged by Morris Betesh and Omar Ferreira of Meridian Capital.
***
Douglaston Development notched a $287M financing package for a 17-story, 456-unit mixed-income multifamily rental development at 1057 Atlantic Ave., according to a release. The developer secured an $185M mortgage from a coalition led by Wells Fargo Bank, partnering with M&T Bank as joint lead arranger and BankUnited also participating. Ares Real Estate invested $102M in preferred equity in the project. A Greystone Capital Advisors team led by Paul Friend and Drew Fletcher put together the capital stack, with co-developers BEB Capital and Totem investing in the $320M development alongside Douglaston. The project is one of the last to be built using the now-expired 421-a tax break, earmarking 137 of its units as permanently affordable.
***
Alfred Mitaj, the restaurateur who owns Hudson Heights eatery Fresco’s Pizzeria, nabbed a $10.1M mortgage for a Pelham Bay residential development, Crain’s New York reported. Mitaj has plans to develop a 46-unit property spanning eight stories on two adjacent lots at 1616 and 1620 Crosby Ave., causing controversy in a neighborhood that is largely made up of two-story properties. NorthEast Community Bank provided the loan.
