This Week’s N.Y. Deal Sheet
Activity is heating up while temperatures are plunging in New York, as the classic end-of-year bump in deals is starting to filter through.
TOP LEASES
RXR has signed law firm Scott + Scott LLP to a 21K SF lease at the Helmsley Building. Scott + Scott will take the entire 24th floor at 230 Park Ave., moving from its subleased space on the 17th floor. Newmark’s Scott Klau, Brian Waterman, Erik Harris, Zach Weil and Cole Gendels, as well as RXR’s own William Elder, Andrew Ackerman and Walt Rooney, represented the landlord, while Savills’ Erik Schmall and Scott Weiss repped the tenant. Even with a new tenant, the property could be in trouble. A CMBS loan secured against the 1.3M SF, 34-story office tower was transferred to a special servicer due to “an imminent maturity default” earlier in November.
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The Durst Organization has a new tenant at 1155 Sixth Ave. IMA New York, an insurance broker previously known as York International, has signed for 10K SF on the 33rd floor of the 42-story Midtown office tower. IMA’s 10-year lease puts it in the same building as tenants Cornell University and Verizon. IMA will occupy a pre-built suite in the property while the landlord builds out its space. Durst recently completed a $130M upgrade to the building, which included revamping its lobby and elevators. Tom Bow, Rocco Romeo and Nora Caliban repped the landlord in-house, while JLL’s Howard Hersch and Brett Harvey repped the tenant.
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Private equity-backed cosmetics company Orveon has signed a 23K SF lease at Stawski Partners’ 579 Fifth Ave., Commercial Observer reported. Orveon’s space will be on the ninth and 10th floors of the 17-story building, where it will relocate from WeWork’s 500 Fifth Ave. Asking rents were $65 per SF in the 150K SF property, where other tenants include hedge fund Hollis Park Partners and real estate investment firm Hubb NYC Properties. JLL’s Paul Glickman, Diana Biasotti, Greg Wang and Harrison Potter repped Stawski Partners, while Shay Bolton, Jim Wenk, Alex Redlus and Kirill Azovtsev of Savills repped Orveon.
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Hines’ 75 Varick St. is swapping out razor subscription company Harry’s for productivity app-maker Notion Labs, Commercial Observer reported. Notion Labs had been subleasing 27K SF from Harry's on the eighth floor, but it has now signed a direct lease for that space, plus 23K SF on the ninth floor, bringing its total footprint to 50K SF. Harry’s, which had been in the 17-story landmarked building since 2017, terminated its lease as part of the Notion Labs deal. Asking rents were $90 per SF. David Falk, Peter Shimkin and Jonathan Franzel of Newmark repped the landlord, while Jeffrey Fischer and Joseph D’Apice of CBRE repped the tenant.
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Global investment firm Battery Ventures signed for 11K SF at Sovereign Partners’ 100-104 Fifth Ave., Commercial Observer reported. Asking rents in the 20-story property were $95 per SF, with Battery Ventures’ lease in place for a five-year term. The property changed hands earlier this month, with former landlord Clarion Partners selling the 20-story building to Sovereign for around $125M after paying $230M for the property a decade earlier. The Kaufman Organization’s Grant Greenspan repped Sovereign Partners, while Eric Cagner and Leo Koné of Newmark repped Battery Ventures.
TOP FINANCING DEALS
MCR Hotels nabbed a $260M refinancing package for the Sheraton New York Times Square from Island Capital Group, according to a release. MCR and Island Capital acquired the hotel in April using funds provided by Fortress Investment Group. That $250M loan is being retired in favor of Island Capital’s four-year, floating-rate loan. The hotel, which spans 50 stories and has almost 1,800 keys, is at 811 Seventh Ave. in Midtown and was first built in the 1960s, according to the hotel’s website. A JLL team led by Kevin Davis, Mark Fisher and Russell Freed arranged the deal.
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Merchants Capital has agreed to lend $232M to refinance and rehabilitate almost 1,000 affordable housing units in the Bronx, according to a release. The Union Avenue Consolidated project features seven affordable housing developments, spread across 18 buildings and totaling 983 units. The Merchants Capital loan, which is a Freddie Mac capital markets execution loan, will be used to support updated heating infrastructure and develop a tailored social services program. The borrower on the Union Avenue Consolidated project is The Bronx Housing Preservation Experience LLC, a joint venture of The Arker Cos., a Nuveen-controlled entity that was formerly Omni NY, and SBV RE Investments LLC and Dabar Development Partners.
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Chetrit Group scored a $235M construction loan for an Upper East Side development, Commercial Observer reported. The site encompasses 252-254, 257, 259 and 260 East 72nd St., the former St. John the Martyr church. Chetrit is planning to build a 150K SF residential condo tower. The luxury property will have 21 stories and 54 units as well as ground-floor retail. Chetrit Group has been acquiring the land parcels since 2015. G4 Capital Partners provided the construction loan in a deal arranged by Galaxy Capital’s Henry Bodek.
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Deutsche Pfandbriefbank has agreed to provide a $125M refinancing loan to a joint venture of Midtown Equities and Rockwood Capital for their 12-story Financial District office property, 1 Broadway, PincusCo reported. The joint venture bought the 206K SF building for $139.5M in 2018, with the new loan retiring a $123.9M loan that also came from Deutsche Pfandbriefbank. The property, which was first built in 1745, has availabilities from its second through seventh floors, according to the building’s website.
TOP SALES
A mostly rent-stabilized property in Washington Heights has sold at a discount, The Real Deal reported. Mardave Management sold 788 Riverside Drive, where 53 of the 62 units are rent-stabilized, for $10.2M to Friedland Properties. Of the remaining units, four are free-market and five are rent-controlled, according to a release detailing the sale. The price falls below the $13.75M sale price that Mardave was asking when it was marketing the 11-story, 81K SF property in May. The prewar apartment building had undergone substantial capital improvements in recent years, according to a release.
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Allied Properties has purchased a seven-story Bay Ridge office building for $15.6M in a foreclosure proceeding, PincusCo reported. Madison Realty Capital provided Allied with an $11.9M acquisition loan. The sale price is almost 50% below the $28M bids that were expected when the property was first put into bankruptcy in April, according to previous reporting from The Real Deal. The property, located at 9201 Fourth Ave., spans almost 100K SF and had been in trouble since as early as 2017, when former owner SPL Partners entered into a property management contract that SPL alleged left the property in disrepair. New York Community Bank said that SPL had defaulted on a $16.4M loan in 2021. It sold its debt interest to Allied Properties, which started foreclosure proceedings shortly after. Those proceedings were delayed after SPL filed for bankruptcy.
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Kushner Cos. sold two multifamily walk-ups in Alphabet City for a combined $19.5M, PincusCo reported. Sabet Group bought the properties, 504 East 12th St. and 508 East 12th St., which have 28 units apiece. The buildings span a total of 31K SF.
