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Category ArchiveBruce Mosler

MIPIM: US Experts Tell World America Is Loaded With Opportunities, So Act Fast

Those that attended Commercial Observer’s panel on United States real estate investing today—the second day of the annual MIPIM (or Marché International des Professionnels d’Immobilier) property conference in Cannes, France—were told there are ample deals to be made in America.

At the event “Developing & Investing in the United States: Where, What & How?” some of the most prolific developers and lenders in the U.S. told real estate professionals not to worry about reports of rising interest rates, to expand their horizons beyond premium “gateway” markets (like New York City or San Francisco) and to act quickly or risk losing the deal.

Brookfield Property Partners Senior Managing Partner and Chairman Ric Clark opened the event by talking about the three trends his company sees affecting the U.S. real estate market: booming population growth of urban areas; the rise of millennials and increases in innovation; and technology for properties.  

Expanding on the first point, Clark said that cities around the U.S. are projected to have 350 million residents in the year 2050, up from 125 million in 1960. In 2014, he said, that figure was 258 million people. 

“Growing urban populations clearly present major challenges, but also major opportunities for those in the real estate business,” Clark told the audience. “The new city dwellers are going to need places to live and work, new schools and hospitals and a massive investment infrastructure will also be required.”

Bruce Mosler, the chairman of global brokerage at Cushman & Wakefield, moderated the first panel about developers’ thoughts on the market, which included Hines CEO of Capital Markets and the East Region Christopher Hughes; SL Green Realty Corp. co-Chief Investment Officer Isaac Zion; and Eran Polack, CEO and co-founder of HAP Investments.

Mosler informed the crowd of the reduced investment activity in New York City and other U.S. gateway markets, which resulted in a 23 percent drop to $96 billion last year from $125 billion in 2016. Comparatively, total investment in non-gateway U.S. markets dropped to $300 billion in 2017 from $339 billion in the previous year—just a 3 percent dip.

Hughes mentioned that investors need not focus only on gateway cities, because there are great opportunities elsewhere in the country.

“It’s a default to look at the gateway cities,” Hughes said. “As you start to look at the U.S. markets you should pay attention to the broader U.S. markets. You’ll make a mistake if you come to the U.S. and think there are only three cities to invest in. Follow the education [centers]; follow the underlying demand drivers.”

Zion pointed out that foreign investors need to understand that deals in the U.S. happen fast, so they need to be decisive.

“The quick ‘yes’ is always the best answer,” he said. “The quick ‘no’ is almost as good. It’s the long, long ‘maybe’ which unfortunately happens way too often. And if you are in that position you are not going to be able to act on potential opportunities.”

The second panel, moderated by Jonathan Mechanic, the chairman of the law firm real estate department at Fried Frank Harris Shriver & Jacobson, focused on lenders’ views of the U.S. market, and featured panelists Michael Shields, a managing director of ING Real Estate Finance; Christoph Donner, CEO of Allianz Real Estate of America; and Alexander Joerg, a managing director and head of real estate finance at Landesbank Baden-Württemberg.

Since capitalization rates—the expected rate of return on a project—are higher in the U.S. than in major European markets, investors can see a lot of upside, Shields said.

“You are breaking 3 [percent] caps in Paris and Berlin, so our risk guys when they see a 5 [percent cap rate], even though the base rate is higher, they like the U.S.,” Shields said. “And it’s such a big market. There are so many deals compared to [Europe]. London and Paris are the only two markers that have deal flow that compares to the U.S. So we could be a lot more selective and cherry pick a bit and figure out where we can actually compete.”

And since interest rates are climbing, now is the time to act, said Donner, who suspects that the movement in rates will boost deals.

“I think we are going to see more volume just because rising interest rates [means] it’s time now for clients to lock in rates for the long term,” he said, “because on a really long-term perspective these are ultra-low rates.”

Source: commercial

It’s MIPIM Time: Why You Should Be Excited for the Cannes Conference

Once again, it’s that time of the year for real estate professionals across the globe to head to Cannes, France.

Just two months ahead of the invitation-only Cannes Film Festival, where movie stars will take to the sandy city on the French Riviera and no doubt trade Harvey Weinstein horror stories, tens of thousands of men and women in business suits carrying briefcases and card holders will storm the streets of Cannes hunting deals during the annual MIPIM (or Marché International des Professionnels d’Immobilier) conference on March 13 through March 16.

The bulk of the events, which is organized by Reed Exhibitions subsidiary Reed MIDEM, will be held at the Palais des Festivals et des Congrès, a massive conference center on the Cannes waterfront.

MIPIM’s theme for the 29th annual conference is “Mapping World Urbanity,” and the event’s programming will try to address issues like, How will we live in cities in 2030 and 2050? And, what are the best strategies for building future cities in a globalized world?

There are plenty of reasons to be excited for MIPIM, but to approach a conference as big as this (with more than 24,000 people), a roadmap might prove useful. We talked with a few MIPIM-goers from the U.S. to get an idea of what the sophisticated attendant should look out for this year.

Networking (duh)

With approximately 24,200 expected participants from over 100 countries, it’s more than possible to find the right person to talk to at MIPIM, whatever your needs may be.

Of the attendees, there will be 5,000 investors and financial institutions, 4,500 developers, and 3,800 CEOs and chairpeople scrambling around the waterfront and in the Palais des Festivals. And there will be more than 3,100 exhibiting companies.  

And in case the conference center isn’t your scene to swap business cards, networking parties will take over the swanky hotels, luxury yachts and the beach.

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With an array of events and booths, there’s ample opportunities for networking at MIPIM. Photo: MIPIM

“The most important thing for me is the networking,” said Susan Greenfield of Brown Harris Stevens, who has been to the event for 28 consecutive years and has already booked her flight for No. 29. “I go every year because it’s the one place in the entire year where I see almost everyone I know from around the global at the same time.”

She added, “The thing that is so important about this event is you get so many decision-makers. One day I was walking down the street [in Cannes] and who could be facing me walking the other direction? Harry Macklowe. I said, ‘What are you doing here?’ He said, ‘I’m here to look for money, what are you doing here?’ ”

City and country exhibitions

If you’re thinking global and want to know what investment opportunities there are in cities abroad, this is the event for you.

The European cities put on a show at MIPIM, bringing large-scale panoramas of entire cities and models of megaprojects to dedicated pavilions. Last year, London and Istanbul had massive jaw-dropping displays.

“Some of the models and booths are off the charts,” said Jay Olshonsky, the president of NAI Global, who has gone to MIPIM for seven consecutive years and is returning this year. “Some people told me some of the models there are million-dollar [displays]. I always leave two or three hours for myself to walk around because you always see something you’ve never seen before.”  

“Le Grand Paris,” the name for the pavilion dedicated to the City of Lights, will feature 19 exhibitions and events each day. Belgium’s pavilion will feature experts and models of Flanders, Brussels and Wallonia, while Holland’s space will be dedicated to Amsterdam, Rotterdam, Utrecht and The Hague.

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Model displays of cities and large developments are popular in MIPIM, such as this one of London last year. Photo: MIPIM

On top of these, there will be booths dedicated to countries from Asia, Africa and North America. Not that the models and displays of cities are there just to be pretty or promote specific projects and the companies that are developing them; more than 370 political leaders and 500 representatives from cities will be in attendance to talk about development in their cities, attract developers and get investments in their locales. (We’ve already heard from the Moscow delegation!)

“If you go to ICSC in Vegas, which is by far a bigger show [with 37,000 attendees], it’s more about the displays about the companies [not cities],” Olshonsky said. “New York City doesn’t come and display at ICSC like Paris does in MIPIM.”

Panel events and keynote speeches

It’s not all deal-making and networking—MIPIM is also a place to learn about development trends across the globe. The event will feature more than 360 keynote speeches and well over 120 panels, sessions, workshops and networking socials covering a wide variety of topics—from Asia and Europe to sustainability and logistics.

And those events will also serve to gather experts across the globe and offer opportunities to get someone’s ear.

“[After networking,] the second thing that I find very valuable is attending these program and panels because I learn so much,” Greenfield said. “You never stop learning and real estate is always changing. If you don’t stay ahead, if you don’t stay involved, if you don’t stay knowledgeable, then you are going to miss out.”

Some panels to look out for include “Self-Driving Cars: Bringing a New Face to our Cities,” “Smart Housing: What Millennials Expect,” “Belt and Road Initiative: Capturing Opportunities Through Hong Kong” and “Urban Logistics: the Next Challenge for Cities.”

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The comprehensive panels with world-class experts are plentiful at MIPIM. Photo: MIPIM

And even Commercial Observer is getting in on the action, co-organizing the U.S.-focused two-panel event entitled “Developing and Investing in the United States: Where, What & How?” on the morning of March 14 at The Ruby Room in Palais des Festivals.

Ric Clark, Brookfield Property Group’s senior managing director and chairman, will deliver the keynote address and Jonathan Mechanic, the chairman of Fried Frank Harris Shriver & Jacobson’s real estate department, will moderate the panels. Cushman & Wakefield’s Bruce Mosler, SL Green Realty Corp.’s Isaac Zion, Hines’ Christopher Hughes, Hap Investments’ Eran Polack and Allianz’ Christoph Donner are just some of the panelists. (You can find us there!)

Tech

Come for the drinks and deals, but stay for the tech!

For the past couple of years, the presence of property technology companies has grown at MIPIM. As the sector is becoming a force in the industry—making more investors curious about what’s next to come—MIPIM has stepped up to provide some answers.

There will be a PropTech Lab event at MIPIM for the first time on March 15, where  invite-only real estate executives and tech leaders will meet and talk about the increased impact of technology on real estate.  

“MIPIM events and conferences will be great opportunities for members of the REBNYTech team to meet with industry leaders of tomorrow,” Ryan Baxter, a Real Estate Board of New York vice president for management services and government affairs, who is heading to MIPIM this year again and is a member of the advisory board of MIPIM PropTech, said in a statement. “We’re looking forward to learning more about smart cities and human-centric innovation efforts from around the world.”  

MIPIM also serves as the final leg of the third-annual MIPIM Startup Competition, an international tech competition in partnership with MetaProp NYC, a real estate tech accelerator. Nine finalists at the nexus of tech and real estate were selected from three previous events, MIPIM U.K., MIPIM Asia and MIPIM PropTech (in Manhattan), and those companies will face off in Cannes to determine the best of the lot on March 14.

The competitors from New York City’s MIPIM PropTech that are heading to Cannes are Real Atom, the first online marketplace for commercial real estate debt financing; PlanRadar, a digital software that facilitates project management for construction companies; and Acasa, an app that helps individuals manage household bills.

The winner will receive three passes to both MIPIM U.K. and MIPIM Asia 2018, four passes to MIPIM 2019 (again in Cannes), an automatic selection as a finalist for MetaProp NYC’s 2018 accelerator program as well as brand exposure and coaching at this year’s MIPIM.

And take in Cannes, for goodness sake!

“If you think about it, if you have got to go somewhere 6,000 miles away—for you and I, it’s not too shabby to go to the south of France,” Olshonsky said.  

Cannes is packed with bars, restaurants, hotels and historic buildings all within walking distance of the beach. For those looking to notch Michelin stars on their belts, there are plenty of options. La Palme d’Or, Villa Archange, Paloma and L’Oasis all hold multiple stars.

There are luxury hotels all around the beach area of Cannes. Some leading contenders are Hotel Barrière Le Majestic Cannes, InterContinental Carlton Cannes Hotel and Grand Hyatt Cannes Hôtel Martinez thanks to their astounding architecture and rich history.

And speaking of history, while you’re in town for a real estate expo, why not do a little sightseeing? Cannes is home to Eglise Notre Dame d’Espérance, a 17th century gothic church set atop a hill that overlooks the port area and it provides some amazing views. And there is also the Musée de la Castre, a museum that is set in a castle built by 11th-century monks.

Also just like the Hollywood Walk of Fame, Cannes is known for Allée des Étoiles du Cinéma, where stars leave their handprints. Finally, don’t forget to talk a stroll along the Promenade de la Croisette if you didn’t already do so on your way to and from the convention center.

Source: commercial

Rock On! This Isn’t Your Father’s Rockefeller

Standing tall at 33 stories high, 75 Rockefeller Plaza was originally built for the Standard Oil Company and known as the Esso Building; it was later renamed the Time Warner Building, serving as the media conglomerate’s headquarters until its lease expiration in 2014. The building’s iconic address and its newly blank canvas was too great an opportunity to pass up for RXR Realty, the owner with a dominant presence in midtown including Class A assets such as 1330 Avenue of the Americas, the Helmsley Building, 450 Lexington Avenue, and 1285 Avenue of the Americas.

When RXR acquired “75 Rock,” it embraced a vision to restore and fully reposition the building to meet the needs of tenants seeking a trophy address and the world-recognized Rockefeller name. Cushman and Wakefield’s Chairman of Global Brokerage, Bruce Mosler, comments on RXR’s completed vision, “This is a building for those seeking both exclusivity and a contemporary environment for their employees. The level of service from lobby experience to overall property maintenance is exceptional.”

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75 Rock was originally constructed with a structural steel frame, concrete slabs, and a limestone façade –  a New York City landmark of the mid-century era. The owner was quick to recognize existing challenges that could warrant typical market pushback – ceiling heights, T-shaped base floor plates, as well as some compromises in views for certain floors.

A holistic renovation plan, including both structural improvements and lifestyle innovations, was needed to attract tenants and produce a building worthy of 75 Rock’s stature and location. To address this, RXR created and deployed a $150 million redevelopment plan. The first step was restoring the building’s limestone façade, staying true to the building’s original design. The same limestone is found in the through-block lobby connecting entrances between 51st to 52nd Streets and also includes terrazzo floors, an elemental designed 24’ ceiling, a skylight, bronze concierge desk, and gallery space for public art.

RXR also set out to increase the efficiency of the building by reconfiguring its core, making it more efficient and spacious for tenants. 12 new passenger high-speed elevators with marble interiors have been equipped with a destination dispatch system to minimize wait-times, and new HVAC and electrical systems were installed to continue the building’s modernization.  RXR addressed the environmental impact of the asset during the renovation process, implementing new optimized windows. The property anticipates LEED Gold designation.

Additional features that continue to create leasing traffic at 75 Rock include extensive terrace opportunities on the tenth floor with a dramatic floor-to-ceiling solarium, as well as modernized mechanical systems that increase finished ceiling heights above 9 feet throughout the tower.  Building-wide fiber optics, an internet-based tenant work order and visitor processing system, bike storage, augmented loading dock, and messenger center all contribute to the functional modernization that satisfies today’s tenants. Tara Stacom, Executive Vice Chairman of Cushman & Wakefield, praised RXR’s work, “the impact of the significant renovation is immediate and apparent upon entering the lobby and carries throughout the entire building.”

The progressive ownership of RXR goes beyond making physical improvements, offering a service model far ahead of the competitive set – one that is tailored to the profile of its buildings and the tenant mix within them. At 75 Rock, RXR hosts a lively integrated art program, punctuated by the permanent 7ft by 90ft Markus Linnenbrink installation of poured resin, an invigorating use of color. The attention-grabbing Paparazzi Dogs, the four bronze sculptures by celebrated contemporary artists, Gillie and Marc, engage both tenants and the plethora of people walking through. Above the lobby, 75 Rock’s pre-built full floors and marketing spaces also include an array of contemporary art.

RXR’s ownership comprehensively addresses all of the signature elements of being in a world-recognized business and tourist destination at the crown of Rock Center, and tenants like Bank of America/Merrill Lynch have taken notice. The institution’s Wealth Management division occupies 185,000 square feet in the base with multiple terraces. Responding to the tremendous foot traffic, and more specifically, the family foot traffic from Rockefeller Center, RXR staged a major retail coup, bringing American Girl Doll off of Fifth Avenue, and into its rejuvenated 40,000 square foot retail experience.

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75 Rockfeller Plaza

The remaining retail space is experiencing a surge of traffic by “world-class dining and ‘foodie’ establishments,” states Michael O’Neill, Cushman and Wakefield’s Senior Director of Retail Services. “With popular bridge retail such as Warby Parker and Blue Mercury now on Avenue of the Americas, the success of the Baccarat and new boutique hotels like The Whitby, interesting, desirable retail and dining options are peppering midtown side streets. 75 Rock has a triple-threat advantage being amid prime shopping, business, and tourism, as well as luxury mixed-use and residential towers.” The strategic and fully segregated through-block entrances for office tenants also keeps dense shopping foot traffic away from the office occupants.

“Office activity has been extremely strong,” explains Mosler, “the full floors in the tower satisfy many of the boutique financial firms migrating from Fifth and Park Avenues. Ownership is committed to making deals happen and is efficient in the process.”

Contributing to the robust pick up in interest at 75 Rock is RXR’s own office expansion onto two full floors, signaling the management team’s support for the asset and its fully modernized, ultra-equipped office environment, and an address synonymous with status. It has been noted that other tenants in the area have vocalized the personable nature of the building staff when entering or passing through the building.  Mosler continues, “Today, ‘state-of the-art’ goes beyond the physical improvements. Tenants pay up for the amenities and service model, which – when done well – requires hands-on, dedicated ownership to see it through.”

While Manhattan’s midtown trophy towers see the ebbs and flows of market interest, tenants at 75 Rock are meeting ownership’s pricing due to the quality of the physical asset and the level of service. Ira Schuman, Vice Chairman of Savills-Studley, explained, “our clients recognize that beyond the successful transformation and major redevelopment of the property, the building has so many practical advantages – proximity to east and west transportation lines, excellent management, and access to first-class amenities.”

Leading the way in employee well-being and professional success, RXR is currently working with Convene to launch a new concept at 75 Rock, which combines Convene’s existing conferencing amenities on one full tower floor, with a private member experience to drive business networking, wellness and education series, and one-of-a-kind dining experiences on the building’s entire top floor. Michael Burke, Convene’s VP of Real Estate and Development explains the collaboration, “today’s office tenants demand a more evolved workplace, and even the most iconic real estate must adapt. Convene is thrilled to expand on our partnership with RXR as a driving force for the re-imagined employee experience at Rockefeller Center.” This partnership will benefit both co-working entrepreneurs, and the usual suspects of Fifth Avenue financial institutions.

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Paparazzi Dogs by Gillie and Marc

“The building is an ideal fit for foreign banks, wealth management, and boutique financial users,” according to Schuman, who recently represented Austria’s leading bank, Erste, in leasing the entire 12th floor. “Tours are impressive to prospective tenants and RXR is terrific through the transaction process.” RXR’s commitment to customer service and meeting the expectations of future decision makers is apparent.

“Ownership is breathing a new spirit and energy into a Class A trophy building, making it approachable and desirable to the new shifting users and office cultures,” asserts Mosler. RXR’s adoption of forward-thinking leasing and marketing trends further demonstrates management’s foresight surrounding tenant psyche. Pronouncedly so, the current marketing campaign emphasizes the changing face of today’s female executive and speaks to the many female decision-makers touring space at the building. 75 Rock also features a newly completed pre-built collection ranging from 4,000 to 7,500 square feet utilizing a high-end and hospitality-inspired design palette. Management recognizes the demand for such space and anticipates building more of it. Tara Stacom affirms, “the economic value of this level of turnkey space outranks competitive availabilities in the market.”

On a final note, RXR recently completed a $300 million refinancing with TH Real Estate – another piece of the plan to adapt this marquee asset for today’s tenant. The modernization of 75 Rockefeller Plaza demonstrates the power of an owner and developer when it is committed, not only to leasing space today, but to investing in the holistic success of its tenants tomorrow.

Source: commercial

Optimism Abounded at REBNY’s 2018 Prom

Despite a tumultuous year for real estate—with investment sales falling off a cliff, retail suffering due to technology and banks tightening their lending—it was a night full of spendor, high spirits and big names at the Real Estate Board of New York’s gala yesterday.  

The 122nd annual REBNY banquet at the New York Hilton Midtown at 1335 Avenue of the Americas featured a power-packed list of politicians, developers, brokers, bankers and other professionals. Many in the room expressed optimism for 2018 to Commercial Observer.

“It’s a great time to celebrate the industry,” REBNY President John Banks told CO, without giving further explanation.

However, Bruce Mosler, the chairman of global brokerage of Cushman & Wakefield, later expounded that economic factors are positive and things seem to be looking up for 2018.

“I’m not worried about macroeconomic risk, I’m more concerned about geopolitical risk,” Mosler said.

While nearly 2,000 partygoers hobnobbed at the cocktail hour before the award presentation, members from the Campaign to Stop REBNY Bullies rallied in front the hotel against the trade organization.

Top pols that graced the event included Mayor Bill De Blasio, recently minted for his second term, Attorney General Eric Schneiderman, New York City Comptroller Scott Stringer, Bronx Borough President Rubén Díaz Jr. and Brooklyn Borough President Eric Adams. Meanwhile, some of the real estate community’s brightest stars in attendance included RXR Realty’s Scott Rechler, Extell Development Company’s Gary Barnett, Durst Organization’s Douglas Durst, C&W’s John Santora, CBRE’s Mary Ann Tighe (a former REBNY chairman), L&L MAG’s MaryAnne Gilmartin and Robert Lapidus (also of L&L Holding Company), Avison Young’s A. Mitti Liebersohn, Newmark Knight Frank’s Barry Gosin, former REBNY President Steven Spinola; and new REBNY Chairman William Rudin, the CEO and co-chairman of Rudin Management Company.

United States Senator of New York Senator Chuck Schumer, the only politician being honored with the award last night, was busy in Washington, D.C., with Congress trying to pass a spending bill to avoid a government shutdown. (He earned the John E. Zuccotti Public Service Award.)

Tishman Speyer President and Chief Executive Officer Rob Speyer, REBNY chairman until December 2017, was the recipient of the Harry B. Helmsley Distinguished New York Award. LeFrak Organization CEO and Chairman Richard LeFrak was presented the Kenneth R. Gerrety Humanitarian Award.

Joanne Podell, an executive vice chairman at C&W, earned the Louis Smadbeck Memorial Broker Recognition Award. Rudin Management Company Senior Vice President Gene Boniberger was honored with the George M. Brooker Management Executive of the Year Award. Ron Lo Russo, the president of C&W’s agency consulting group, won the Young Real Estate Professional of the Year Award.  

And Elizabeth Stribling, chairman of Stribling & Associates, received The Bernad H. Mendik Lifetime Leadership in Real Estate Award. In her speech, Stribling recalled having known Mendik and what it was like attending the REBNY banquet for the first time.

“It was exactly 50 years ago tonight that I first attended my first REBNY gala as a 21-year-old rookie broker,” she said. “I was starstruck. And I still am.”

Source: commercial

Hyundai Luxury Car Division Taking 40K SF of Retail in Meatpacking District

Luxury car brand Genesis Motors has reportedly inked a lease for around 40,000 square feet of retail space at the Solar Carve Tower presently under construction at 40 10th Avenue in the Meatpacking District.

Genesis, a wholly owned subsidiary of South Korean automotive manufacturer Hyundai Motor Company, is said to be taking the space at the base of the 10-story, 139,000-square-foot office tower currently being built next to the High Line between West 13th and West 14th Streets, The Real Deal reported Wednesday.

The transaction ranks as one of the priciest retail leases of 2017, according to TRD, with Genesis paying an estimated annual rent of $11 million, or roughly $275 per square foot. The deal will likely see Genesis take all of the Solar Carve Tower’s roughly 27,700 square feet of ground-floor and lower-level retail space, according to property marketing materials, as well as additional office space (such as most or all of the building’s 13,700-square-foot second floor).

Jared Epstein of Aurora Capital Associates handles retail leasing at 40 10th Avenue on behalf of the landlord—a partnership between Aurora and William Gottlieb Real Estate—while Richard Nassimi and Michael Lohan of The Nassimi Group represented the tenant, according to TRD. Representatives for Aurora and The Nassimi Group did not return requests for comment.

Construction on the Studio Gang Architects-designed tower, notable for its gem-like glass facade, began earlier this year and is slated for completion in early 2019. The building will feature a 10,000-square-foot shared outdoor roof deck and 8,000 square feet of outdoor space on the second floor adjacent to the High Line, as well as private outdoor terraces on eight of the nine office floors.

In September, TRD reported that Aurora and William Gottlieb had secured $120 million in construction financing from Bank of the Ozarks for the project. A Cushman & Wakefield team led by Bruce Mosler is handling office leasing at 40 10th Avenue, though no office tenants have yet been announced.


Source: commercial

NYU Langone Health Renews 74K SF in FiDi

NYU Langone Health has signed an early renewal for 74,069 square feet at 14 Wall Street that is home to the hospital’s administrative offices, Commercial Observer has learned.

The institution, which has been in the 37-story tower for a decade, will continue to occupy the entire ninth and 10th floors of the building between Nassau Street and Broadway—formerly known as the Bankers Trust Building—for another 15 years.

Asking prices in the 1-million-square-foot office building near the New York Stock Exchange range from the mid-$40s per square foot to the low $50s per square foot, according to Cushman & Wakefield.

“Ownership was delighted to renew their lease with NYU Langone Health,” C&W’s Alan Wildes said in prepared remarks. “Situated in a vibrant Downtown location, 14 Wall Street presents an exceptional opportunity for NYU Langone Health to continue to thrive.”

Wildes worked alongside colleagues Stephen Bellwood, Jonathan Fein, Carlos Suarez and Lou D’Avanzo in representing the landlord, billionaire Alexander Rovt. C&W’s Mark Mandell and Bruce Mosler handled the deal for NYU Langone Health. Mandell and Mosler declined to comment via a spokeswoman for C&W.

The landmarked 1912-skyscraper at 14 Wall Street features 13-foot ceiling heights and renovated windows, elevators and common corridors, as well as a modern lobby. Existing office tenants include Amerigroup and Barclays, while retailers there include T.J. Maxx and Starbucks and Equinox.


Source: commercial

Coworking Company Spaces Establishing NYC Flagship in 100K SF at Manhattan West

Brookfield Property Partners six-building Manhattan West megaproject is getting a major coworking tenant.

Amsterdam-based workspace provider Spaces has leased 103,000 square feet across seven floors in a building known as The Lofts at 424-434 West 33rd Street, the landlord told Commercial Observer. The coworking company will take the seventh through 13th floors in the top half of the former printing loft building between Ninth and 10th Avenues.

The asking rent in the 10-year deal was in the high $70s per square foot, according to David Cheikin, an executive vice president at Brookfield. Spaces will get its own private entrance and lobby, as well as a 2,000-square-foot rooftop and multiple terraces. The building has 15,000-square-foot floor plates, exposed steel beams, and high ceilings, plus newly revamped elevators, lobbies and mechanicals.

“Our average tenant size at Manhattan West is 200,000 square feet,” Cheikin said to CO. “We wanted to provide those tenants with the ability to grow and shrink a bit and provide them WITH the resources for conferencing and flexible work environments.”

He also explained that the loft building will connect to Manhattan West’s 250,000 square feet of retail, anchored by a 60,000-square-foot Whole Foods.

Brookfield had originally planned to knock down 424-434 West 34th Street in order to amass a larger site that would allow for a big retail and hotel project, Cheikin said. “But when we actually got into the building, we realized it was a really good turn-of the century printing loft building that added some authenticity to our site of what the neighborhood used to be.”

Spaces is planning to make The Lofts its flagship outpost in the five boroughs, where it already has 44 locations and 1.3 million square feet of offices, according to Michael Beretta, the vice president of network development in Spaces’ Americas division. This will also be its largest space in the city, where typical Spaces locations average 30,000 to 50,000 square feet apiece.

JLL’s Jim Wenk, Brannan Moss and Kirill Azovtesv represented Spaces. Cushman & Wakefield’s Bruce Mosler, Josh Kuriloff, Robert Lowe, Ethan Silverstein, Matthias Li and Whitney Anderson worked on behalf of Brookfield.

Mosler declined to comment on the deal, and a spokesman for JLL didn’t immediately respond to a request for comment.

The seven floors will be constructed with movable walls, prebuilt suites, large coworking areas, conference rooms and event spaces. The interiors are going to be renovated with a “cool and contemporary design that’s European in nature and a mix of casual and interesting while still remaining a very professional place where companies can do business,” Beretta said. He added that the company chose The Lofts because it’s a building with “character” but the project will offer all the amenities of new construction, including a significant retail component.

Spaces already rents at a few other Brookfield properties, including 245 Park Avenue, 1 Liberty Plaza and Brookfield Place. It expects to open at Manhattan West in late 2018.

Pioneering, Luxembourg-based coworking provider IWG Plc (formerly Regus) owns Spaces, which has tried to pitch in urban markets as a trendy competitor to WeWork

The lower half of 424-434 West 34th Street is currently home to several small office tenants. All of them will be vacated by 2021, when Brookfield plans to put the building’s remaining 100,000 square feet of office space on the market.


Source: commercial

Developers Talk the Remaking of Downtown, One Brick and Restaurant at a Time

When Larry Silverstein realized he would have to rebuild the World Trade Center in 2001, he never anticipated that the Financial District would experience a renaissance. But after the construction of three new World Trade towers, the new Fulton Transit Center, the Oculus, and the Shops at Brookfield Place, Manhattan’s long-sleepy downtown is seeing something of a rebirth.

 

co downtown 65 Developers Talk the Remaking of Downtown, One Brick and Restaurant at a Time
co downtown 104 Developers Talk the Remaking of Downtown, One Brick and Restaurant at a Time
co downtown 71 Developers Talk the Remaking of Downtown, One Brick and Restaurant at a Time
co downtown 109 Developers Talk the Remaking of Downtown, One Brick and Restaurant at a Time
co downtown 10 Developers Talk the Remaking of Downtown, One Brick and Restaurant at a Time

“​Sixteen years later, it’s nothing short of remarkable,” said Silverstein, speaking at Commercial Observer’s New Face of Downtown event in L&L Holding Company’s 195 Broadway. He touted the area’s 12 subway lines, its wealth of new restaurants, and its relatively youthful residential community compared to more established ‘hoods like the Upper East or Upper West Sides.

​”We’ve decided we’re moving away from the old fogies up there, because of the youth down here,” said Silverstein, who is himself picking up and moving with his wife from Park Avenue to his new condo development at 30 Park Place. “It’s the youthful vibe, it’s the authenticity, it’s the access to great amenities, access to great transit.”

Downtown Alliance head Jessica Lappin pointed out that the Financial District offers Class A office space at an average of $63 a square foot, a $20 discount from typical asking rents in Midtown, and class B office space for $53 a square foot. And 90 percent of the neighborhood’s jobs are within a five-minute-walk of at least seven subway lines, she said. Their conversation, which occurred during the day’s second panel on the “WTC Effect,” was moderated by Michael Zetlin, the founding partner of Zetlin & DeChiara.

During the morning’s first panel, on how building upgrades could attract tenants to Downtown properties, everyone agreed that millennials and their companies were looking for more efficient workspaces and amenities that could help them attract talent and run their businesses well in the 21st century. Fried Frank real estate chairman Jonathan Mechanic moderated, and the speakers included Brookfield Properties Senior Managing Partner Ric Clark, L&L Holdings Chairman David Levinson, and Matt Straz, the founder and chief executive officer of a human resources software startup, Namely.

Clark explained that he had encouraged his tenants to order an app called Ritual, which allows workers to order food from restaurants in the Shops at Brookfield Place and get a notification to go down and pick up their food when it’s ready, rather than standing in line. He’s also working on setting up a security system that allows tenants to use an app on their phones rather than a key card to swipe into the building.

Most of our tenants look at geography as the key,” said Cushman & Wakefield chairman Bruce Mosler. “They want open space, large floor plates. They want to be around a 24-7 environment.”

Mosler emphasized the need for landlords to bring in companies like Convene, which create communal workspace amenities, like conference rooms, that tenants can choose to rent on an hourly or daily basis. “Ownership that has gone through those processes [to invest in their buildings] are going to reap the benefits,” said Mosler. “And buildings that haven’t been invested in are going to have trouble in the future.”

Levinson explained that he had tried to “future-proof” 195 Broadway, which is a century old but features large blocks of column-free space. However, he noted that “some people want something with a vintage, a history,” even though older properties like 195 Broadway have lower ceiling heights than new construction.

Ultimately, though, everyone wanted to celebrate FiDi’s new lease on life.

You’d come down here at 5:30 at night and there’d be no one on the street,” said Levinson. “Now it’s a full blown, serious community.”


Source: commercial

Amazon Taking 360K SF at 5 Manhattan West for 2,000-Employee Office

Hot on the heels of Amazon’s new fulfillment center in Staten Island, the e-commerce giant—founded by Jeff Bezos—has signed a 360,000-square-foot deal at Brookfield Property Partners 5 Manhattan West building, the landlord announced today.

The digital retail company will occupy the entire sixth and seventh floors and portions of the eighth and 10th floors of the building, which is located on 10th Avenue between West 31st and West 33rd Streets, bringing the building’s occupancy to 99 percent. The building is a part of Manhattan West, Brookfield’s eight-acre, six-building mixed-use development. A Brookfield spokeswoman declined to disclose the asking rent and term of the lease.

Amazon will move into the building next year. In exchange for creating 2,000 office jobs at the property, the state will give Amazon $20 million in tax credits. A variety of roles will be undertaken at the location, with the e-commerce giant hiring software engineers to data analysts to economists. It will also be the primary location in New York for Amazon’s advertising divisioncomprised of sales, marketing, product, design and engineering staffers.

“We’re excited to expand our presence in New York—we have always found great talent here,” Paul Kotas, Amazon’s senior vice president of worldwide advertising, said in prepared remarks.

Derek Trulson, Josh Stuart, Bill Peters and Clay Nielsen of JLL handled the deal for Amazon, while Brookfield was represented in-house by Jeremiah Larkin, Duncan McCuaig and Alex Liscio and a Cushman & Wakefield team of Bruce Mosler, Josh Kuriloff, Rob Lowe, Ethan Silverstein and Matthias Li. Spokesmen for brokers on both sides of the deal did not immediately return requests for comment.

Brookfield completed a $300 million redevelopment of the 16-story, 1.8-million-square-foot building, formerly known as 450 West 33rd Street (and informally as one of the ugliest buildings in the city), into an all glass structure.

“Amazon’s expansion is the latest example of a leading company drawn to Manhattan West by the unparalleled access, state-of-the-art office space, and experiential culinary, health and wellness and fashion provided by Brookfield’s newest placemaking destination,” Ric Clark, senior managing partner and chairman of Brookfield, said in prepared remarks.

Whole Foods signed a 60,000-square-foot deal to anchor the 100,000 square feet of ground floor retail space at the redesigned building.

As previously reported by Commercial Observer, the Amazon deal at 5 Manhattan West comes just weeks after the company announced a it was opening an 855,000-square-foot, $100 million fulfillment center at the 200-acre Matrix Global Logistics Park. Around 2,250 operations employees will be hired for that new location, and Amazon will receive $18 million in state tax credits in return.

The company also has plans to open a second headquarters that will cost $5 billion to build, and house as many as 50,000 workers, although it has not picked a site for it yet.


Source: commercial

Brooklyn Nets’ Parent Company Moving to 70K SF at Industry City

Brooklyn Sports & Entertainment, which owns and manages Barclays Center and the Brooklyn Nets, is moving its corporate offices to the 6-million-square-foot Industry City, according to a Brooklyn Sports news release today.

The sports company, owned by Russian billionaire and politician Mikhail Prokhorov, has leased 70,000 square feet for the entire seventh floor of 168 39th Street in the Sunset Park section of Brooklyn, directly one floor below the HSS Training Center where the Brooklyn Nets practice. (The Nets opened the nearly $50 million practice facility in early 2016.)

TPG Architecture is designing the new digs at the building between First and Second Avenues, which will accommodate 350 employees. The space will undergo a full renovation and feature an open-floor plan. A Brooklyn Sports spokesman declined to disclose the terms of the lease, but said he expects the company will move into the new space in June 2018 from its 47,000-square-foot offices at 15 MetroTech Center at the corner of Myrtle Avenue and Flatbush Avenue Extension in Downtown Brooklyn.

Cushman & Wakefield’s Bruce Mosler and Joseph Cirone handled the deal for Brooklyn Sports, while a Newmark Knight Frank of David Falk, Kyle Ciminelli and Whitten Morris negotiated the lease for the landlord, a partnership led by Jamestown and Belvedere Capital. Spokesmen for C&W and Newmark did not immediately respond with a comment from the brokers.

“Since 2012, our company has nearly doubled in size and we are looking forward to having these new corporate offices in order to support our continued growth,” Brett Yormark, the chief executive officer of Brooklyn Sports, said in prepared remarks. “Additionally, with Brooklyn Nets business and basketball united under one roof, we will further build a collaborative work environment that encourages innovation and teamwork.”

Since Brooklyn Sports launched five years ago it has grown to include the NYCB LIVE, which is the Nassau Veterans Memorial Coliseum in Uniondale, N.Y., and the business operations for the New York Islanders. It plans to add additional venues as well.

“It says a lot that after nearly two years of experiencing all that Industry City has to offer, the Brooklyn Nets chose to locate their corporate offices here, when they could have gone anywhere,” Kathe Chase, the director of leasing at Industry City, said in a statement.  

In a separate transaction, Brooklyn Sports announced that it was taking 3,400 square feet at SL Green Realty Corp.’s 125 Park Avenue between East 41st  and East 42nd Streets in Midtown East, for a sales and content development office. It will also help serve as meeting space for the company. That office will open in September.


Source: commercial