This Week's NY Deal Sheet

Manhattan's red-hot leasing market kept up its frenetic pace last week, with Spotify's major deal leading the charge of office expansions, including big moves in Dumbo, Union Square and Downtown.

TOP LEASES

It is hardly news anymore, but here is a reminder: Spotify signed a 378k SF, 11-floor lease at 4 World Trade Center last week, with options to expand to 13 floors. That makes the building, repped by Silverstein Properties' Jeremy Moss in-house and CBRE's Mary Ann Tighe, David Caperna, Steve Eynon, Adam Foster, Evan Haskell, Rob Hill, Ken Meyerson and Stephen Siegel, fully leased. JLL's Peter Riguardi, Alex Chudnoff, Ken Siegel and Jim Wenk repped Spotify.

***

British firm Tullett Prebon plans to take 125k SF at 200 Vesey St. in Brookfield Place in Lower Manhattan, staying within the submarket but leaving Jack Resnick & Sons' One Seaport Plaza. JLL’s Scott Panzer and Shannon Rzeznikiewicz repped Tullett, and Brookfield Property Partners repped itself in-house. The deal will likely make Brookfield Place more attractive as Brookfield shops a minority stake for north of $2B.

***

Maryland-based 2U, an education tech firm, has joined the ranks of companies exchanging smaller Manhattan digs for bigger space in Brooklyn. 2U signed a deal for 78k SF at 55 Prospect St. in Dumbo Heights with landlords Kushner, LIVWRK and RFR. Savills Studley's Craig Lemle, Nick Zarnin and David Fleisher, along with Adam Schindler and Paul Schweitzer of Serten Advisors, repped 2U and got $20M in incentives in the deal. CBRE's Sacha Zarba and Jeff Fisher repped the JV. 2U is expanding from its 20k SF spread in Chelsea Piers. Asking rent in the new deal was in the mid-$60s/SF.

***

Beauty company Avon is undergoing a huge downsize of its NYC operations, moving from 247k SF at 777 Third Ave. to 91k SF at One Liberty Plaza in Lower Manhattan. The Empire State Development Corp. gave Avon $4M in incentives for the move, but Avon agreed to foot its build-out costs, which will be more than twice that. It's a sweet deal for One Liberty landlord Brookfield, and Avon is hoping to sublease its HQ in the William Kaufman Organization building it is deserting, where its lease runs until 2025.

*** 

Vornado's 888 Seventh Ave. nearly had a 40k SF vacancy caused by insider trading fallout from Visium Asset Management; instead, the REIT was able to seamlessly replace the closing firm with Hutchin Hill Capital, a hedge fund. Visium terminated its lease as part of its liquidation, and Hutchin Hill will occupy its spread on the 21st and 22nd floors on April 1. CBRE’s Ben Friedland, Silvio Petriello and Michael Wellen repped the tenant, while Jared Solomon repped the landlord in-house. Asking rent was reportedly $92/SF.

***

Residential brokerage Compass continues to gobble up offices, this time taking up 25k SF more at its HQ at 90 Fifth Ave. Compass had 90k SF in RFR's building, and now it controls 115k SF, the entirety of its office space. RFR president Gregg Popkin and A.J. Camhi, along with JLL's Jon Fanuzzi, Mitchell Konsker, Dan Turkewitz and Adam Haber repped RFR. Cushman & Wakefield's Ethan Silverstein repped the tenant, which is expanding all over the city.

***

Mount Sinai Health System is moving its corporate offices to 57th Street between Broadway and Eighth Avenue. The medical provider plans to occupy 26k SF on the 15th floor at Empire State Realty Trust's 26-story 250 West 57th St. Cushman & Wakfield's Harry Blair and Sean Kearns, along with ESRT's Keith Cody, repped the landlord, while Chris Mongeluzo of Newmark Grubb Knight Frank repped Mount Sinai.

TOP SALES

Zar Property acquired the loft office property at 250 West 54th St. in Midtown for $83.1M in a value-add play. Zar acquired the building from Ascot Properties, which was repped by NGKF's Paul Davidson, Roy Lapidus and Chip Porter. Zar plans to undergo a major renovation of the 145k SF property, attempting to turn it into a creative office magnet. 

***

A group of Israeli investors bought 475 Kent Ave. in Williamsburg for $55.7M, acquiring the property that was once a pasta factory, but most recently has been used by local artists. Norman Brach sold the building to a group led by Gaia Investment Corp., which is planning to build out ground-floor retail space to increase the building's value and cachet.

***

Icon Realty paid $33M to acquire 133 West 25th St. in Chelsea from Dezer Properties. Dezer bought the 45k SF, nine-story office property in 1998, and Icon nailed down financing from Bank Leumi to the tune of $24M to complete the transaction. 

***

Acquity Capital Partners has acquired 185 Marcy Ave., a 70k SF prewar office building in Williamsburg. Acuity and its partner, Nationwide Insurance, paid a family trust $30M to buy the one-time YMCA rooming house. Acuity, repped by William Lang of Winston Strawn, is planning to reposition the 114-year-old property.

***

Pinnacle Group has closed on its $26M acquisition of a Flushing rental property at 136-04 Cherry Ave. Pinnacle acquired the six-story, 76-unit, rent-stabilized building in Flushing from Myung Sonoda's Garden Plaza Management.

Sales data provided courtesy of Reonomy

TOP FINANCING DEALS

Less than two months after signing Bed, Bath & Beyond subsidiary One Kings Lane to a 52k SF deal at 315 Hudson St., Jack Resnick & Sons has secured a loan to cash in on the property. JPMorgan Chase came through with the refinancing for $85M, which includes a new mortgage of $50M and replaces the previous loan, a $35M deal with Morgan Stanley.

***

Hampshire Properties has secured a significant construction loan, locking down $70M to fund a 302-unit rental property in Midwood, Brooklyn. Israeli Bank Leumi provided the loan to the project at 1277 East 14th St., an eight-story redevelopment of the former Shulamith School for Girls, at a time when American banks are reticent to engage in new development lending.

***

Walter & Samuels has secured $60M to refinance 227-241 West 61st St., a three-story building that houses the West End Secondary School. Allegiant Real Estate Capital provided the 10-year loan in a deal brokered by JLL.

***

Resnick's firm was an active borrower last week; in addition to its Hudson Street refinancing, it also locked down a $50M refinancing deal with Prudential for 485 Madison Ave., a 24-story, 304k SF office property in Midtown.

***

Weinreb Management secured a $50M refinancing for 350 Central Park West, its 16-story, 292k SF apartment building on the Upper West Side. Capital One provided the financing, which consolidates $14M in new debt and replaces a $40M loan from Santander Bank.

Financing data provided courtesy of Reonomy