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Category ArchiveABS Partners Real Estate

Knotel Takes Full Floor at Beijing Shokai Group-Owned Chelsea Building

Office provider Knotel’s appetite for Manhattan commercial space continues unabated, with the startup having inked a 12,683-square-foot lease at 224 West 30th Street in Chelsea, Commercial Observer has learned.

Knotel signed a 10-year deal late last month for the entire fifth floor at the 14-story, roughly 143,000-square-foot building between Seventh and Eighth Avenues, according to sources with knowledge of the transaction.

Asking rent in the deal was $52 per square foot, sources said. James Caseley, John Brod and Alison Miller of ABS Partners Real Estate represented the landlord, a subsidiary of China-based real estate investment and development firm Beijing Capital Development Holding, also known as Beijing Shokai Group. Knotel was represented by Jessica Tu of CJ Net Inc. and Aziz Kabbaj of Mirador Real Estate.

While the lease commenced at the beginning of this month, Knotel expects to take occupancy of the space after completing a buildout of the offices. The company provides flexible, short-term office arrangements to mostly small- to mid-sized businesses—though it is increasingly serving larger corporations like Starbucks, which recently took a full floor at a Knotel location at 72 Madison Avenue in NoMad, as CO reported this month.

In a statement, Brod said Knotel’s buildout of its full-floor space will “reflect its brand.” He added that ABS has “been working closely with ownership to transform this building, which is presently comprised of fur showrooms, into a premiere office destination within the Penn Station/Hudson Yards corridor.”

A spokeswoman for Knotel confirmed the deal but did not immediately provide comment. Representatives for CJ Net and Mirador could not immediately be reached for comment.

Knotel has signed a flurry of office leases across New York City, and expanded into the San Francisco office market, since sealing a $25 million Series A funding round in February 2017. (Disclosure: Observer Capital, led by Observer Media Chairman and Publisher Joseph Meyer, is among Knotel’s investors).

The company claims it now has more than 700,000 square feet under lease across more than 40 locations in New York and San Francisco, expects to grow its total footprint to several million square feet before the end of the year and has plans for further expansion into global markets including London.

Source: commercial

Watchmaker Accutime Renews HQ at 1001 Avenue of the Americas

Watch manufacturer Accutime Watch Corporation is keeping its headquarters at 1001 Avenue of the Americas after agreeing to renew its 12,107-square-foot offices at the Garment District building, Commercial Observer has learned.

Accutime signed a seven-year lease to remain in its space, comprising the entire sixth floor of the 24-story, 240,000-square-foot property at the northwest corner of West 37th Street and Avenue of the Americas, according to sources with knowledge of the transaction.

Asking rent in the deal was in the mid-$50s per square foot. Landlord ABS Partners Real Estate was represented by an in-house team of James Caseley, Alison Miller, Gregg Schenker, Earle Altman and Steven Hornstock; that team also worked on behalf of tenant Accutime, according to ABS.

“We are proud to have maintained an excellent relationship with Accutime and are happy that 1001 Avenue of the Americas continues to meet their needs,” Caseley said in a statement.

Other tenants at building include accounting firm Schulman Lobel, engineering firm Lilker Associates Consulting Engineers and social media marketing firm The Social Edge.

Source: commercial

Barneys Shuttering Upper West Side Store After More Than a Decade

Barneys New York is closing its Upper West Side store store on Feb. 18, a company spokeswoman confirmed to Commercial Observer.

“Barneys New York has enjoyed serving the community on the Upper West Side for over a decade. We sincerely appreciate the loyalty of our customers, and we look forward to continuing to serve them at our Madison, Downtown and Brooklyn locations,” the spokeswoman emailed.

West Side Rag first reported the news on Feb. 2 based on information provided by a manager.

The roughly 10,000-square-foot clothing store, which is on the ground and lower levels at 2151 Broadway between West 75th and West 76th Streets, opened in 2004, according to retail broker Faith Hope Consolo of Douglas Elliman Real Estate, who represented the landlord in the original lease negotiations with Barneys. The space underwent a renovation in July 2013, which included rebranding it from a Co-op store—selling lower-price fashion—to a Barneys New York. (The company has converted Co-ops stores to Barneys New York shops.) The lease is slated to expire at the end of 2023, according to CoStar Group.

Once it shutters, there will be two remaining Barneys stores in Manhattan: one at 660 Madison Avenue between East 60th and East 61st Streets and one at 101 Seventh Avenue between West 16th and West 17th Streets.

“This is a big loss for the Upper West Side,” Consolo said. The deal was unique at the time as most retailers were focused on Columbus Avenue, but Barneys took a Broadway space.

Broker John Brod, a partner at ABS Partners Real Estate, said the news is of no surprise.

“Customers can go on line at Bonobos, UNTUCKit, Allbirds, Amazon, Suitsupply and manufacturers’ own online e-commerce store to purchase the same merchandise so the need for Barneys to have a brick-and-mortar presence has past,” Brod emailed. “Specifically, Barneys is a multi-brand retailer and as such the need for a second store in a secondary market becomes redundant in today’s retail and shopping environment. The issues are further challenged by the general state of retail in this area—note that Sephora has opted to downsize from their 2162 Broadway location—they passed on their right to renew. Moreover, Anthropology who was negotiating to replace Sephora here after many months of negotiation, decided not to proceed. Additionally Eastern Mountain Sports vacated this area [at 2152 Broadway] as well. The fact is there is a very limited demand for large flagships in both primary and secondary markets. Clearly the Upper West Side is a secondary market.”

The market and neighborhood combined to hurt Barneys.

“Barneys closing is a reflection of the current market,” said SCG Retail Partner David Firestein. “With that said, they were never right for the neighborhood, in the mid 70s. A better fit would have been closer to Lincoln Center, near Century 21.”

And the popularity of online food shopping has impacted the area, including Barneys.

“That stretch of Broadway has always been local, and much of its traffic from shoppers that live or work outside the market area was based on the food anchors—Citerella, Fairway and Zabars—all on the west side of Broadway in a seven-block stretch,” said Robin Abrams, a vice president at Eastern Consolidated. “Once it became possible to get fresh produce and a wide array of prepared foods at the various Whole Foods [stores], Fairway’s other locations and a variety of other competitors, the pedestrian traffic on Broadway diminished. Now the retailers on Broadway must be strong to cater to local traffic, and even stronger if they are to pull from a broader customer base.”

Source: commercial

Investment Firm Takes 145 East 57th Street Penthouse

A private equity firm has snagged the newly constructed penthouse at ABS Partners Real Estate’s 145 East 57th Street, also known as the Hammacher Schlemmer building, Commercial Observer has learned.

Speyside Equity has inked a five-year deal for the 2,650-square-foot suite on the top floor of the 12-story, 64,000-square-foot office building between Third and Lexington Avenues, according to information from the landlord. Asking rent for the in Midtown East space was $80 a square foot.

The Ann Arbor, Mich.-based firm, which invests in metal, chemical and food manufacturing companies, will move from subleased office space in the Paramount Building at 1501 Broadway between West 43rd and 44th Streets. Its new home will have floor-to-ceiling glass windows looking out on 57th Street, 14-foot ceilings and a large private terrace.

Speyside Founder Kevin Daugherty said in prepared remarks that the new office would allow the company to “expand our team as we raise our next fund in the coming months.” He added, “We are excited about the space and feel it will really create an attractive and energetic environment for our team.”

The firm raised $130 million in 2016 for its first institutional fund, according to industry reports.

ABS’ John Brod, Robert Finkelstein and Alex Kaskel handled the transaction in-house. Speyside was represented by Town Commercial’s Nancy Shapiro. A spokeswoman for ABS didn’t immediately return a request for comment.

“It has pretty spectacular outdoor space for commercial,” Shapiro told CO. “It’s beautiful, it’s modern, it’s clean. It’s a very upscale space. They wanted something that would reflect more on the work they do, which is taking these struggling manufacturing businesses and putting them in a better state.”

ABS purchased the 64,000-square-foot, 1926 commercial property for $63 million in October 2016, according to property records. It renovated the building into boutique office space with six floors of prebuilt space, stainless steel appliances and a curated art display in the lobby.

Source: commercial

Direct Mail Startup PebblePost Inks Deal to Quadruple Its Offices

PebblePost, a direct mail marketing startup, recently signed a 19,644-square-foot deal at 400 Lafayette Street to nearly quadruple the size of its offices, Commercial Observer has learned.

The company, which uses its software to learn consumers’ computer search habits and target them with printed advertisements for products, moved into its new digs earlier this month and is occupying the entire second floor of the five-story building, which is located at the corner of East 4th Street in Noho.

The asking rent in the deal was $75 per square foot, according to information provided by ABS Partners Real Estate

“400 Lafayette Street offers large, open floor plates that allow businesses to build  offices that foster creativity and encourage collaboration,” said ABS’ James Caseley in prepared remarks, who represented landlord Sand Associates with colleagues Charles Conwell and Joseph LaRosa. “The second floor provided the ideal amount of space for PebblePost, which is in the midst of an explosive expansion.”

PebblePost relocated from nearby 36 Cooper Square between East 5th and East 6th Streets, where it had 5,000 square feet.

Since PebblePost’s founding in 2014, the company has raised $63 million, according to Crunchbase. This year alone it raised $47 million with a combination of equity and debt.

“PebblePost was in immediate need of a larger space to accommodate its rapidly growing staff,” Savills Studley’s Craig Lemle, who represented PebblePost with colleague Nick Zarnin, said in a prepared statement. “The space at 400 Lafayette provides PebblePost the ideal location, size and buildout to move in quickly and continue to grow in a space that is in line with the company’s culture and business objectives.”

Existing tenants at 400 Lafayette include event ticket marketplace SeatGeek, advertising and technology company TripleLift and La Colombe Coffee Roasters.

Source: commercial

Kellogg’s Opening More Permanent Café in Union Square

Kellogg’s NYC, an all-day breakfast café which closed its pop-up in Times Square this summer, is opening a new more permanent eatery in Union Square.

The company has announced that on Dec. 7 the new café will open at 31 East 17th Street, a building between Park Avenue South and Broadway that runs through the block between 17th and 18th Streets. Kellogg’s will span 5,000 square feet on the second floor of Standard Realty Associates’ two-story, 15,000-square-foot building, according to a press release from ABS Partners Real Estate.

ABS’ Mark Tergesen and Jennifer Bernstein represented the tenant in the transaction, while the landlord was represented in-house. The ABS team declined to provide the asking rent or the length of the lease.

“31 East 17th Street is a unique property that provides Kellogg’s with an opportunity to make an immediate impact when it comes to visibility and branding. Union Square is a highly trafficked area and, coupled with the building’s all-glass facade, will allow the Kellogg’s branding to stand out and encourage passersby to walk in,” Tergesen said in a prepared statement. “The second floor that Kellogg’s will occupy is a functional, dramatic space with skylights and a block-through layout, providing customer access from both East 17th and East 18th Streets. The open space can also accommodate much larger events than the previous Times Square location, allowing the brand to interact with its customers in more ways than before.”

31 east 17th street aka 36 east 18th street photo costar group Kellogg’s Opening More Permanent Café in Union Square
31 East 17th Street. Photo: CoStar Group

There will be an open kitchen and a significantly larger space for dining, lounging and collaboration, Kellogg’s said in a release.

“We’re excited people can experience cereal in new ways all the time at our permanent location, versus other pop-ups which we’ve seen can quickly come and go,” Aleta Chase, Kellogg’s marketing director, said in a release. “Whether people stop in for a quick meal or end up spending the afternoon or early evening with us, Kellogg’s NYC Café in Union Square will truly be a home for food exploration—tailored to give everyone endless flavor possibilities when it comes to cereal.”

The café, where dishes start at $5.95 for a cereal creation with a choice of milk, has a menu that includes milkshakes, pop tarts and ice cream sundaes. Items from the old menu that will have a comeback in Union Square include Berry Me in Green Tea, Life in Color and The Corny Blues, according to the ABS release.

Kellogg’s opened its doors to its first brick-and-mortar pop-up café on July 4, 2016 in 1,600 square feet of ground-floor space (800 square feet for dining and 800 square feet for the kitchen) at 1600 Broadway between West 48th and West 49th Streets with a one-year lease and two one-year extension options, as CO previously reported. The company decided to renew its space for another year, but closed on Aug. 13 this year. A Kellogg’s NYC spokeswoman didn’t respond to a request for information about the Times Square lease.

At 31 East 17th Street, the 17th Street ground floor is leased to AT&T. And on the 18th Street side, which uses the alternate address of 36 East 18th Street, the ground floor is available for lease.

Source: commercial

Owners Magazine 2017: Interviews with NYC’s Top Landlords

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At the risk of stating the forehead-slapping obvious, it’s been a strange 12 months.

There’s been a mixture of good and bad real estate news that can paint a picture of continued stability or darkening clouds on the horizon, depending on your point of view.

By October, the vacancy rate in all three major Manhattan markets for office space appeared to be falling, per Cushman & Wakefield data. Hundreds of thousands of square feet have been leased by Spotify, GroupM, Amazon and others. All of that is inarguably good news.

However, a year ago, few people knew that we were sitting on a retail powder keg ready to blow and take some of the biggest names in the industry with it, like Toys “R” Us, Aerosoles, Payless, Radio Shack…you get the idea. This is inarguably bad.

This is one of the reasons why it’s important to have a magazine like this one.

Yes, the data, the deals and the numbers are critical to understanding the state of real estate. But it’s also important to get a sense of what the key players are thinking right now. That’s why we asked 36 of the biggest names in the business what their vision of the market looks like.

We’ve supplemented these questionnaires with our own reported features.

Last year, New York was considered immune to the vicissitudes of the world economy because we were always a safe, stable place to park cash. That looked like less of a sure bet when China announced new outbound investment rules. Lauren Elkies Schram examines the topic in her story in this issue.

Some in the real estate community long hoped for a challenge to Mayor Bill de Blasio in this year’s mayoral election and put substantial money behind Paul Massey (one of their own) to take the reins of City Hall before that fizzled out. At the risk of propagating a Dewey-Truman blooper (we ship this magazine before Election Day), Aaron Short reported what developers are expecting and hoping for in de Blasio’s second term.

While many developers have spent the last few years touting the Far West Side of Manhattan, there is actually quite a bit of activity on the East River, something that Rey Mashayekhi examines in depth.

Finally, Liam La Guerre looked at something that’s always been written off as anathema to real estate developers: technology. It turns out, the shrewd owners are not only interested in tech, but they’re also developing their own. — Max Gross 

Source: commercial

Think Small: How Manhattan Office Landlords Are Courting the Market for Modest Space

In the New York City office market, the big deals get all the attention. Landlords usually covet major six-figure-square-footage users who can lock down large blocks of space at their buildings, bringing with them the security of long-term leases that can anchor a property for a decade or longer. Brokers, meanwhile, covet the sizable commissions that come from representing such large-scale clients.

The reality, however, is that most of the city’s office stock is occupied not by major corporations leasing multiple floors at Class A Manhattan buildings, but by small-to-midsized businesses across a diverse range of industries that require more modest footprints.

Of the roughly 21 million square feet of Manhattan office space leased through the first nine months of this year, more than 4.6 million square feet came in the form of deals for less than 10,000 square feet, according to data from CBRE. (By comparison, deals between 25,000 and 50,000 square feet and 50,000 and 100,000 square feet each comprised 3.1 million square feet of leasing activity.) From more traditional financial services and legal firms to the younger tech, media and creative-oriented companies increasingly fueling New York City’s economy, it is this scale of user that drives much of the city’s office leasing activity.

The relatively modern phenomenon of coworking—initially popularized in the 1990s by Regus (now IWG) but revolutionized by WeWork and a whole crop of like-minded firms in recent years—has added another wrinkle to this equation. As the startup economy produces wave after wave of nimble new companies that have looked to coworking spaces to suit their needs, landlords have caught onto the trend and sought to capitalize—often through smaller, prebuilt office layouts positioned as both an alternative to shared office space and an option for young companies that have outgrown the coworking model.

“There’s been a shift in the small-user paradigm where players like WeWork are accommodating businesses that can be run out of a knapsack,” said Jay Caseley, an executive managing director at ABS Partners Real Estate and head of the brokerage and property management firm’s office leasing operations. “Several of our tenants are so-called graduates from that environment. When those people get tired of being in a crowd, they want to have some autonomy and privacy.”

At properties like 200 Park Avenue South near Union Square, owned by a group of ABS investors, Caseley said the firm has taken the approach of prebuilding units as small as 900 square feet in spaces that it inherited from larger tenants whose leases have expired. Such units not only meet certain tenants’ more limited space needs, but as prebuilts, they are also “more or less ready to move in” and are being leased out at terms usually no longer than three years—the sort of flexible arrangement tailored for nascent small businesses.

While noting that he would “shudder to not accommodate renewals to full-floor tenants,” Caseley said ABS has found success in catering to smaller office users. “We find that the smaller units rent more quickly, have less long-term issues with vacancies and give us a formula where we have a portfolio that’s attractive to [tenants] under the current market conditions.”

It is a formula with which other landlords and property managers have also found success. At the Adams & Co.-owned 110 West 40th Street near Bryant Park, the landlord, brokerage and property management firm is taking an approach more closely mirroring the coworking phenomenon—but with a more established twist.

Adams is pursuing a strategy where it is breaking up entire floors at the 26-story, 140,000-square-foot building into prebuilt suites ranging from 600 to 1,500 square feet. In addition, the company has equipped the building with features including a shared conference center and lounge area, as well as tenant-controlled HVAC systems and a full-time concierge.

“For a small tenant, the majority of the options are in coworking, but coworking isn’t for everybody,” said David Levy, a principal at Adams & Co. “When you have a real business that wants its own space, and the owner wants his own office, the ability to find that space is limited.”

Of the 27 such units Adams & Co. has built at 110 West 40th Street thus far, Levy said 26 have been rented out—mostly at lease terms between three and five years and at asking rents between $65 and $75 per square foot. He added that the company plans to eventually convert the entire building into small-scale prebuilt units.

buildingphoto 4 e1509488246667 Think Small: How Manhattan Office Landlords Are Courting the Market for Modest Space
110 West 40th Street. Photo: CoStar Group

“We are seeing much more variety than I thought,” Levy said of the tenancy in the building’s prebuilt suites, which includes not-for-profits and tech and design firms as well as financial companies. He added that several “older,” existing tenants at 110 West 40th Street have also opted to move into the smaller new suites, thanks in part to the building’s new features. “They’re downsizing their space, but they don’t need [their own] conference rooms anymore.”

The Kaufman Organization took a similar approach at 27 West 24th Street in the Flatiron District, where it took its 11-story, 125,000-square-foot building and divided the 12,000-square-foot floors into five or six prebuilt units per floor. “We’re the next step from the coworking environment to tenants taking their own spaces,” said Grant Greenspan, a principal and senior vice president at Kaufman.

In addition to offering shorter lease terms, Greenspan said the small-scale spaces at 27 West 24th Street are designed to offer financial value for tenants. “In a coworking environment, between what [coworking providers] are leasing you and the common areas and the amenities, it’s in the $80 to $90 per square foot range,” he estimated. “The thesis [at 27 West 24th Street] is you come in and take 3,000 square feet, and you’re paying $55 to $65 per square foot.”

Greenspan and other market participants noted that the small-scale office model is not a one-size-fits-all approach, as larger tenants locked into longer leases remain an integral part of most commercial landlords’ business models from a financial perspective. Buildings catering mostly to smaller tenants can also run the risk of turning into an office version of a “hotel” if spaces “keep turning over too quickly,” Greenspan said, adding that landlords must also look to build out their prebuilts somewhat “generically” so that they “don’t get caught continuously renovating and repositioning” spaces. “You have to be cognizant of staggering your lease expiration, too,” he added.

But the city’s office market at large—not just the small-space niche—has shown heightened appetite in recent years for prebuilts, too, according to Nicole LoRusso, CBRE’s director of research and analytics for the tri-state region. LoRusso cited figures indicating that, in Midtown Manhattan specifically, the amount of prebuilt space taken by tenants has grown roughly 30 percent from 2015.

“Tenants don’t want to wait six to 12 months to execute a buildout,” LoRusso said. “For a lot of tenants, [prebuilts] are appealing. They don’t know what [their company is] going to look like in the future. The flexibility of not having a long-term commitment and also recognizing that, if you need to grow by 2,000 square feet, you can sign and get that space three weeks later—that’s what’s appealing about it.”

For developers like Josh Caspi of Caspi Development, smaller-scale prebuilts have become a boom business that the market has come to demand. At 79 Walker Street in Tribeca, the firm is taking an approach that has previously served it well at small-scale office projects like 135 Bowery and 161 Bowery on the Lower East Side.

The company is finishing up its conversion of 79 Walker—a five-story, 25,000-square-foot former manufacturing building—into full-floor prebuilt offices spanning 5,000 square feet each. Already, Caspi has secured commitments from the likes of electronics company Bang & Olufsen and digital production music library Epidemic Sound, which were drawn to the prebuilts’ flexible layouts and ample amenities—including convertible conference and breakout rooms, tenant-controlled HVAC systems and high-end kitchenettes featuring quartzite countertops, refrigerators and dishwashers (not to mention a wine fridge).

“The thing I learned as a landlord of large buildings is that there’s no love for this-sized tenant,” Caspi said on a recent tour of the building, which includes a private roof deck for the top-floor tenant and a 3,600-square-foot ground-floor retail space that will be anchored by Chicago burger sensation Au Cheval.

Caspi said that leases at the building generally run between five to seven years at rents in the mid- to high $60s per square foot, with the landlord—like other developers operating in the smaller-footprint market—taking a larger security deposit to offset the risk of its business model. But the prebuilt strategy also means that “turnover costs are less,” according to Caspi, as tenant improvements won’t be required every time a space changes hands. “If you lose a tenant, you just fill it up the next day,” he said.

And then there are real estate startups that are specifically targeting the small-to-midsized tenant space, buoyed by the belief that they understand the needs and requirements of such office users in a way traditional landlords do not.

buildingphoto 44 e1509489073794 Think Small: How Manhattan Office Landlords Are Courting the Market for Modest Space
315 West 39th Street. Photo: CoStar Group

Knotel is a startup office provider that has grown at a prolific pace this year since sealing a $25 million Series A funding round in February. (Disclosure: Observer Capital, led by Observer Media Publisher, Chairman and Chief Executive Officer Joseph Meyer, is an investor in Knotel.) The company has nearly 500,000 square feet of office space currently under lease in New York City, which—unlike coworking providers such as WeWork—it subleases as single-tenant spaces under short-term agreements.

For Amol Sarva, Knotel’s co-founder and CEO, landlords attempting to get into the small-tenant game are chasing a trend that they’re ill-equipped to serve, since they lack the “uniform product experience” offered by Knotel.

“We actually run the office for you—everything about the space is thought about and designed by us, for you,” Sarva said. “We source and deliver all the supplies, services and utilities. We staff the place and know your people. We help them get in, in the morning, and lock up at night. If the building isn’t performing, we take it up with [the landlord]. There’s a whole [real estate] department of your company that you don’t need.”

Traditional landlords, by contrast, mostly provide a lower quality of service and at higher costs than Knotel, according to Sarva. “The only thing they can do is make small boxes and have someone meet you out front [at a reception desk],” he said. “It’s like individual taxi drivers trying to compete with Uber; as the lease becomes the taxi medallion of the office market, these buildings will become taxis.”

Knotel is hoping to further expand its business to the tune of 1 million square feet of office space under lease by the end of the year and recently announced its expansion into the San Francisco market. With small-to-midsized office users fueling the real estate startup’s rapid rise, it would appear that the limited-scale office market is growing more influential than ever.

But Scott Galin, a principal and CEO at Handler Real Estate Organization, said that his firm—which owns a portfolio of office buildings mostly located in the Midtown West area—has been serving that segment of the market for years. At 315 West 39th Street in the Garment District, Handler has converted the entire 16-story, 140,000-square-foot property into small-scale studio spaces averaging between 800 to 1,200 square feet.

Like most buildings in its neighborhood, 315 West 39th Street was formerly a garment factory. But Handler gradually transformed the entire property over the course of the 2000s, several floors at a time, into spaces that were initially occupied mostly by creative and design tenants and now also hold nonprofits and accounting firms.

Today, the building has roughly 140 tenants, which Galin said were drawn to the building’s loft-like spaces and “communal” vibe, as well as its proximity to transit hubs like the Port Authority Bus Terminal and the general transformation of the West Side into a desirable place to do business.

“It took off by itself,” Galin said of the firm’s approach to the property. “It was clear that there was a demand for small space between 500 and 1,500 square feet. These tenants want to be in a cool neighborhood and around mass transit.”

Handler signs most of its tenants at 315 West 39th to leases under five years in length—“When you have so many spaces, tying things up long-term can tie you up long-term,” according to Galin—at asking rents in the mid-$30s to low $40s per square foot. With around 95 percent occupancy, Galin said Handler has never had reservations about relying on such a varied and fragmented tenant base instead of larger users on leases promising longer-term cash flows.

“Having 10,000-square-foot tenants are neat—until you lose that tenant,” he noted. “If somebody wanted to come here and lease a third of the building, we’d have great reservations.”

Source: commercial

Retail Leasing Vet Howard Gilbert Heads to ABS, Says NKF ‘Wasn’t for Me’

Newmark Knight Frank Senior Managing Director Howard Gilbert, a 37-year retail leasing veteran who first brought Forever 21 to Manhattan, has joined ABS Partners Real Estate as an executive managing director, Commercial Observer has learned.

Gilbert, who officially started on July 31, is focusing on retail leasing on both the landlord and tenant sides and oversees a staff of four brokers that makeup the retail division at the company. He said he left NKF after less than three years because “it wasn’t for me.”

He further explained: “You really need to be on a team to be successful over there with a real strong leadership. I worked with a couple of retail brokers on assignments [at NKF], but it’s not the same as being the team. If you aren’t on the top of the totem pole, it’s hard to do business. I can work with the principals [at ABS], which is what I wanted.”

Gilbert, 65, started working at NKF in fall 2014, as CO previously reported. Prior to that he handled retail deals at RKF for nearly two decades. And before that he worked at Garrick-Aug, Wm. A White/Tishman East, and Cushman & Wakefield for a few years each.

Last month he represented a high-end Japanese restaurant in a 10,000-square-foot lease at Rockefeller Center. (He said he could not contractually release the name of the tenant, landlord or building.)

In October 2016, he handled a 6,000-square-feet deal for a Uniqlo pop-up at 1535 Broadway between West 45th and West 46th Streets in Times Square.

Older deals include working with Bank of America to open about two dozen branches and a dozen ATM locations in Manhattan between 2005 and 2010. He was also responsible for bringing Forever 21’s first store into Manhattan at 40 East 14th Street between Broadway and University Place in Union Square in the mid-2000s. And Gilbert handled the apparel company’s Times Square flagship at 1540 Broadway between West 45th and West 46th Street in 2008.

“Howard’s years of expertise and knowledge will not only help to grow our direct business, but will also attract and mentor younger brokers that want to immerse themselves in this industry,” Gregg Schenker, the president and co-managing partner at ABS Partners, said in a statement.

A native of Brooklyn, Gilbert grew up in the Flatbush section of the borough. He graduated with a bachelor of science degree in business administration from the State University of New York at Buffalo in 1973. He currently lives in Stamford, Conn. with his wife of 30 years and their 25-year-old son.

A spokesman for NKF did not immediately return a request for comment about Gilbert’s departure.

Source: commercial

ABS Partners, Altman Warwick Launch Capital Markets Arm

ABS Partners Real Estate and Altman Warwick have formed a shiny, new capital markets advisory platform, ABS Altman Warwick, Commercial Observer can first report.

The joint venture, which will offer commercial brokerage and advisory services, complements ABS’ leasing and investment sales businesses with cross-selling opportunities and has already closed several financings, Brian Warwick, a principal at Altman Warwick, told CO.

The two firms aren’t strangers, having transacted several times together over the years  beginning in 2011, Warwick said. “There are a lot of common core values between the two firms and we work very well together,” he said.

“The benefits of the joint venture are twofold,” said Robert Altman, a principal at Altman Warwick. “It creates a new vehicle for ABS Partners to monetize its existing and future business relationships and, more importantly, it provides a new and valuable service to its clients that is 100 percent complementary and synergistic to ABS’ existing business lines.  We all firmly believe that the more real estate solutions that any financial service company can offer, the more valuable a resource that firm becomes to its clients.”

Altman and Warwick will maintain their boutique brokerage’s Long Island headquarters but be primarily focused on the new joint venture, they told CO, setting up home in ABS’ offices at 200 Park Avenue South.

While ABS Altman Warwick’s focus will be New York-centric, the platform will have a national reach, Gregg Schenker, the president of ABS Partners, said.

“When we worked on financing transactions together the Altman Warwick team proved to be very capable, and that capability intrigued us,” Schenker said. “As the relationship evolved it made sense to both parties to have an affiliation that was more solidified and a more permanent business arrangement, which is the joint venture we’ve now formed. It gives us the ability to have all of the capabilities that come with a capital markets platform in-house.”

Steven Hornstock, co-managing partner at ABS and director of investment sales at the firm, said that the new division complements ABS’ investment sales business nicely. “ABS is a very entrepreneurial brokerage shop. So, for the most part, as a broker, we’re not pigeon-holed to doing office leasing in Midtown South. But now we have new capabilities. And when an investment sales broker is working on a project where there’s a financing aspect, we have that resource in-house.”

Now the business is off to the races, ABS Altman Warwick is actively looking to grow the team and hire “a handful” of experienced commercial mortgage brokers, Warwick said.

Source: commercial