This Week’s N.Y. Deal Sheet
A former WeWork is being taken over by a tech giant that was long a subtenant in the building, the largest deal in what qualified as an active week in Manhattan office leasing.
TOP LEASES
Palantir has signed a direct deal for the space it formerly occupied in a WeWork in Chelsea, Commercial Observer reports. The tech firm run by Peter Thiel has signed for 140K SF at 620 Sixth Ave., a landmarked property known as the Beaux Arts building, where WeWork leased space in 2019. Palantir had previously leased 212K SF but is now slated to stay put in a smaller footprint as a direct tenant with landlord RXR. Asking rents weren’t disclosed, but the building’s other previous tenant under WeWork, banking app Current, also signed a direct lease in November last year with asking rents of more than $100 per SF. Michael Iino of Raise Commercial Real Estate and Michael Morris of Newmark brokered the deal for Palantir.
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Williams Equities signed Bernhardt Furniture to 20K SF at 136 Madison Ave., according to a release. The furniture-maker will take the entire third floor of the 17-story, 300K SF property in Manhattan’s Koreatown. The space will serve as Bernhardt's flagship office and showroom. Other tenants in the building include Syracuse University and Regus. Colliers' Mac Roos, Andrew Roos, Michael Cohen and Jessica Verdi represented Williams Equities, while Cresa’s Peter Sabesan and Matthew Feigen represented Bernhardt.
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Romano Law is relocating its headquarters from 55 Broad St. to Rudin’s One Battery Park Plaza, according to a release. Romano Law will take 8K SF at the 35-story, 870K SF building for an 11.5-year term, joining a tenant roster including law firm Barry McTiernan & Moore, Nationwide Mutual Insurance, The Partnership for New York City, CetraRuddy and nonprofit Partnership with Children. In total, the building has signed 54K SF of leases over the past eight months, according to the release. Bert Rosenblatt of Cresa represented Romano Law, while Rudin’s Kevin Daly represented building ownership in-house.
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Luxury superyacht agency Burgess has signed for 16K SF at 540 Madison Ave., a 39-story tower in Manhattan’s Plaza District, according to a release. The move will see Burgess relocate its Upper East Side office to a new address at the 291K SF building owned by DivcoWest. Representation for DivcoWest, which acquired the property in 2019 and has since made some renovations, was unclear, but the building’s website lists Cushman & Wakefield’s Ethan Silverstein, Daniel Organ, Ron Lo Russo and Peter Kerans as the leasing agents. Matt Emerson represented Burgess in-house, according to CO.
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ASB Real Estate Investments has signed two tenants totaling 16K SF at its 625 Broadway office building, according to a release. Real estate firm Greenbrook signed for 8K SF across the 11th floor, while cloud-based branding platform Frontify signed for 8K SF on the top floor of the 12-story building. The building was constructed in 1896 and most recently renovated in 2021. The landlord was represented by the Kaufman Organization’s Grant Greenspan, Elliot Warren and Jared Sternberg for both deals, with the same brokers also handling the deal for Greenbrook. JLL’s Reid Longley and Joe Speck represented Frontify.
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The Feil Organization has signed real estate advisory company Alvarez & Marsal Property Solutions to 11K SF at 488 Madison Ave., Commercial Observer reported. The Greenwich, Connecticut-based firm is relocating to the 24-story property as it expands from its 6K SF at 600 Madison Ave. It plans to increase its 23-person New York office to around 40 people. The 447K SF 488 Madison tower sits directly north of St. Patrick’s Cathedral and is home to tenants including the Archdiocese of New York and law firm Slater Slater Schulman LLP. Alvarez & Marsal was represented by an in-house team, and The Feil Organization was represented in-house by Andrew Wiener.
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Silverstein Properties and the California State Teachers' Retirement System have signed two tenants to 1177 Sixth Ave., totaling 48K SF in new leases, Crain’s New York Business reported. Mill Point Capital Partners signed an extension and expansion of its headquarters in the building, now taking up more than 23K SF. The YMCA Retirement Fund signed a 25K SF deal to relocate to the Midtown tower from Silverstein's 120 Broadway in the Financial District. Mill Point was represented by Erik Harris of Newmark; the retirement fund was repped by CBRE's Laurence Briody, Lauren Crowley, Courtney Hughson and Eric Sears; and Cushman & Wakefield's Bruce Mosler, Lou D’Avanzo, Ethan Silverstein, Anthony Lopresti, Peter Kerans and Caroline Collins repped building ownership.
The deals mean the 47-story, 1M SF 1177 Sixth Ave. has filled half the space left by Signature Bank after it failed last year. Fitch Ratings said the vacancy rate in the building was 26%, approximately double that of the rest of the avenue, The Real Deal reported. Around 16% of the property’s occupied space could also become vacant in the next three years, Fitch warned.
TOP SALES
Legion Investment Group and EJS Group bought a six-story, 110K SF office building just blocks from Union Square for $57.5M, Crain’s reported. The seller was Philips International, a real estate company based in Long Island. Legion and EJS scored a $37.5M loan from Maxim Capital to finance the acquisition of 5 W. 13th St., with Walker & Dunlop’s Aaron Appel, Keith Kurland, Jonathan Schwartz, Adam Schwartz and Sean Bastian organizing the financing. The 1946-built property was last renovated in 2004 and commands rents between $46 and $56 per SF. It had been home to the New York City Human Resources Administration but is now vacant. Legion, led by Victor Sigoura, is reportedly planning a luxury condo tower as tall as 30 stories on the site.
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Rubin Equities has purchased a South Bronx development site once slated to become a 105-unit rental property, Crain’s reported. The site, 286 Rider Ave., is in the Mott Haven neighborhood and was sold by beleaguered Heritage Equity Partners for $15M. The deal closed May 3. Rubin Equities has worked on a collection of small rental apartment projects, in addition to the Tillary Hotel in Downtown Brooklyn.
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Reshape Properties and Starman Holdings have bought a 39-unit residential apartment building in the West Village from Empire Management for $19.2M, PincusCo reported. Keb Hana Bank provided a $13.5M loan to Starman and Reshape for their acquisition. The six-story building at 208-210 W. 10th St. last sold in 2007 for $7.6M. Empire Management CEO Fred Ohebshalom is a relative of Daniel Ohebshalom, who was indicted this month on 80 counts related to tenant harassment. Fred Ohebshalon also found himself in hot water last year when the city sued him for hundreds of violations across multiple Upper Manhattan apartment buildings.
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Checo Acquisitions spent $14.5M acquiring a pair of adjacent walk-up residential properties on the Upper West Side, PincusCo reported. The firm, headed by Josef Chehebar, bought the properties at 472-476 Columbus Ave. from Bruce Haley. They have a combined total of 36 units, including five storefronts. The sale was the first time that the properties had changed hands since 1979.
TOP FINANCING DEALS
Wells Fargo has agreed to lend $200.5M to Gotham Organization to refinance 55 Suffolk St., Crain’s reported. The luxury Lower East Side rental building rises 30 stories and has 378 units, including 96 affordable units, 6sqft previously reported.
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Lonicera Partners nabbed a $74M refinancing deal for 308 Livingston St., PincusCo reported. First-Citizens Bank & Trust Co. was the lender for the deal on the 160-unit property in Brooklyn’s Boerum Hill neighborhood. The loan replaces a $70M sum Santander Bank issued in 2019.
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Samco Properties notched an $11M loan from Apple Bank to refinance an office building, PincusCo reported. The loan equates to $90 per SF at the Chelsea building, which spans 122K SF at 104 W. 29th St.
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Rockbridge Capital scored a $28.5M loan from BankUnited to refinance the Hampton Inn Manhattan 35th Street Empire State Building hotel at 57 W. 35th St., PincusCo reported. Rockbridge has owned the Garment District hotel since it dropped $68.2M on the building in 2011. The prior lender was PNC Bank, which had loaned $35M on the building.
CORRECTION, MAY 22 2024, 3:30 PM E.T.: Gotham Organization's loan for 55 Suffolk St. was for $200.5M. A previous version of this article misstated the amount. This story has been updated.
