This Week's N.Y. Deal Sheet
It has been a busy week in New York City real estate, with multiple office leases bigger than 100K SF signed and major sales and financing deals coming to fruition as the market shakes off an uneven first quarter.
TOP LEASES
Skidmore, Owings & Merrill will move its headquarters to one of its highest-profile New York City projects, 7 World Trade Center. The architecture firm has signed an 83K SF lease with landlord Silverstein Properties, for which it designed the skyscraper, the first to be built at the World Trade Center after 9/11. SOM plans to occupy 80K SF across two floors in the building in a sublease with Moody's, the building's largest tenant, Crain's New York Business reports. Savills' David Goldstein and Matthew Barlow brokered the deal for SOM, which also designed One World Trade Center, the tallest building in the U.S. SOM plans to relocate next year from its current headquarters at 14 Wall St.
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EmblemHealth, one of the biggest tenants on the market, is deciding to stay put in the city's largest office building by square footage. The nonprofit health insurer has renewed its lease for 440K SF at 55 Water St. EmblemHeath was represented by Colliers International's Brian Given, Sheena Gohil, Steve Jaray and Tom Shirocky. The landlord, an entity controlled by The Retirement Systems of Alabama, was represented by CBRE's Howard Fiddle, Dave Caperna, Brad Gerla, Evan Haskell and Mary Ann Tighe. The lease spans 15 years, and will keep EmblemHealth in the same headquarters it has had since 2003.
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Tishman Speyer will forgo a planned redevelopment of 300 Park Ave. after it reached a deal with the property's biggest tenant, Colgate-Palmolive, to restructure and extend its lease. The consumer products giant signed a 242K SF lease that will consolidate its space to six floors in the 26-story Midtown tower. CBRE's Tighe, Mike Geoghegan, Ken Meyerson and Ariel Ball represented Colgate-Palmolive, and Tishman Speyer was represented by its in-house leasing team. Terms of the deal were not disclosed, but CBRE said in its announcement Colgate-Palmolive will reduce its occupancy cost when the new lease takes effect.
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Knotel, which is currently in talks for funding that could take it to unicorn status, continues to grow at a frenetic pace in Manhattan. The flexible office provider agreed to expand its space at 110 William St. in Lower Manhattan from 36K SF to 117K SF. With the 81K SF expansion, Knotel will occupy the full seventh and eighth floors in the building, in addition to the 17th floor, which it leased in August. Landlords Savanna and KBS Capital Advisors were represented in the expansion deal by Newmark Knight Frank's Hal Stein, Todd Stracci and Travis Wilson, while Knotel was repped by NKF's Greg DiGioia and Michael Morris.
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Rent The Runway made history last week when it signed the largest Manhattan-to-Brooklyn relocation deal since Etsy's 200K SF headquarters move in 2014. CBRE's Frederick Fackelmayer, Alex Benisatto and Sam Mann represented Rent The Runway in the 83K SF lease at 10 Jay St. in Dumbo, while JLL represented the building's owner, Glacier Global Partners.
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Target is continuing its rollout of small-format stores across New York City, signing a deal to open a 24K SF store in Washington Heights, The Real Deal reports. The Minnesota-based retail giant will occupy a two-story retail property at 600 West 181st St., owned by Maverick Management Corp. Target told TRD it expects to open the store at some point next year.
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Nordstrom, which is currently awaiting completion of its Manhattan flagship store on Billionaire's Row, signed two deals to open small outposts in Manhattan designed to complement the department store's online presence. Nordstrom is opening Nordstrom Local stores in The Greenwich Lane, a West Village condo building owned by Rudin Management and Global Holdings Group, and at the corner of Third Avenue and 73rd Street on the Upper East Side, The New York Times reports. The locations will be less than 3K SF and provide services like alterations and tailoring, online order pickups, returns and fitting rooms.
TOP SALES
A joint venture of Himmel + Meringoff and Square Mile Capital has acquired a mixed-use property in the Bronx at 1601 Bronxdale Ave. The 360K SF building is largely designed for industrial and distribution purposes, but also has New York Sports Club as a tenant and includes an office component. The 7.5-acre site traded for $89M, and the new owners plan to make improvements to the property. Pinnacle Realty brokered the deal for the seller, Sackman Enterprises, which has owned the property for nearly 30 years.
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Isaac Kassirer keeps buying up multifamily properties in Upper Manhattan, rent-regulation-caused market freeze be damned. Kassirer's Emerald Equity acquired four Harlem buildings — 120 West 116th St., 110 West 116th St., 1917 Adam Clayton Powell Blvd. and 110 St. Nicholas Ave. — for $40M, The Real Deal reports. Galil Management, which bought the properties for $29.5M in 2014, was the seller.
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The International Center of Photography is the new owner of a commercial condominium in Essex Crossing, the new mixed-use development on the Lower East Side. The ICP paid $29M to acquire its space at 242 Broome St., financing the deal with a combination of a $13M mortgage and a sale of its old space on the Bowery, The Real Deal reports. The developers of Essex Crossing, a joint venture of Taconic Investment Partners, L+M Development Partners, BFC Partners and Goldman Sachs, acquired ICP's old space for $25M, TRD reports.
TOP FINANCING DEALS
In one of the biggest pieces of financing to close in recent months, the Karfunkel family secured a $200M loan from Citigroup to refinance the office tower at 59 Maiden Lane, Commercial Observer reports. The debt will refinance the family's previous $120M loan and recoup nearly $90M in cash equity.
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A trio of developers — DHA Capital, First Atlantic Real Estate and AMS Acquisitions — has secured a $72M debt package from Deutsche Bank, which goes to refinance a 2016 $101M construction loan from Deutsche on their condominium project at 75 Kenmare St., Commercial Observer reports. The building is still under construction, and the developers say 50% of the 38 units are already sold.
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Citigroup was active across Lower Manhattan in the last week, also providing a $55M refinancing package to Winter Properties for its Greenwich Village renovation at 57 East 11th St., Commercial Observer reports. The developer has already signed WeWork to occupy the entirety of the building's 61K SF of office space, and used the new loan to increase its leverage on the property — it previously had a $28M loan from Principal Life Insurance, according to CO, which will be transferred to Citi.
