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Category ArchiveBryant Park

Construction Firm Bravo Takes Full Floor at Adams-Owned Midtown Building

Construction and engineering firm Bravo has relocated its headquarters to a new 10,092-square-foot space at 42 West 39th Street near Bryant Park, Commercial Observer has learned.

Bravo signed a nearly eight-year lease last month for the entire seventh floor at the 18-story, 158,000-square-foot building between Fifth Avenue and Avenue of the Americas, landlord Adams & Co. announced today. The firm moved into its new space earlier this month from its previous location at nearby 14 East 38th Street.

Asking rent in the deal was $44 per square foot. David Levy and Brett Maslin represented Adams in-house, while Michael Doetsch of Coldwell Banker Commercial Advisors represented the tenant.

In a statement, Levy said the tenant was drawn to the property’s access to surrounding transit hubs. “The prime accessibility of 42 West 39th Street from all major transportation hubs is particularly attractive to tenants with business spanning the city,” he said. “It is intrinsically valuable for companies to reach and be reached by potential clients, investors and employees.”

Doetsch could not immediately be reached for comment.

Bravo oversees three separate brands operating in the realm of architecture, engineering and construction: Velocity Architectural and Engineering Services; Bradford Construction; and Chu Engineering. All three brands will occupy the space at 42 West 39th Street.

Other tenants at the building include Spanx, Core Home, Bluefly and Castlewood Group.

Source: commercial

In Cannes for MIPIM, Brookfield’s Ric Clark Is All NYC

Brookfield Property Partners is no doubt one of the most active developers in New York City.

The firm recently completed the redevelopment of its 8.5-million-square-foot Brookfield Place office and retail complex in Lower Manhattan, a $250 million project it commenced in 2015. Today the property is nearly entirely leased. And the developer is building at an aggressive pace the more than 7-million-square-foot Manhattan West project.

The company is also is a partner on Park Tower Group’s 22-acre Greenpoint Landing mixed-use development in Greenpoint, Brooklyn. And on top of that, the developer recently picked up the leasehold of the HBO Building at 1100 Avenue of the Americas along with Swig Company and signed most of the space to Bank of America (386,000 square feet). In addition, Brookfield and Swig recently signed Bank of America to a 127,000-square-foot space at their adjacent property, the Grace Building at 1114 Avenue of the Americas.

Commercial Observer caught up with Ric Clark, the senior managing partner and the chairman of Brookfield, while in Cannes for his very first MIPIM (or Marché International des Professionnels d’Immobilier). His main order of business at the conference: talking about trends in the United States on a U.S. panel co-organized by CO.

But we got to talk to him about the status of the firm’s projects, Brookfield’s investment in on-demand conference space provider Convene and the company’s recent—so far unsuccessful—attempts to acquire General Growth Properties, Forest City Realty Trust and Regus parent company IWG.

Commercial Observer: You have a lot of things going on in New York City. What is the status of Greenpoint Landing, Brookfield’s foray into the outer boroughs?

So the first building opens up in August. I think it’s just shy of 400 units. The second tower will open in 2020 and we hope that we have two more towers coming up on the heels of those.

Park Tower Group brought Brookfield in to do that project. What attracted you to it?

It really started with a desire to expand our presence in the multifamily business. Up until roughly six years ago we really didn’t have any investments in the apartment sector. But looking back it’s been one of the best performing sectors, particularly in New York City—vacancy is very low—tenants tend to stay for a couple of years, and when they do leave the capital expenses are pretty modest unlike an office tenant. Granted stay longer, but when they leave it is a major capital reinvestment to retenant the space. So the first building that we built was The Eugene [with 844 units] at Manhattan West. We are closing in on 80 percent leased now, and it hasn’t even been open [for a year]. So basically on the heels of that and making a decision to enter the multifamily space, we looked around and thought, Brooklyn was a great alternative to Manhattan. It’s cheaper, so more affordable, and there is a lot happening in Brooklyn.

What’s going on at Manhattan West?

So 5 Manhattan West, formerly  known as 450 West 33rd Street, started as an apparel warehouse—at one point it had the Sky Rink—we were able to convert that and put a new facade, new lobby, new systems and take what was once the ugliest building in Manhattan and make it into a pretty attractive building, which is appealing to those in the innovation and technology businesses. So that [1.7-million-square-foot] building is effectively fully leased at this point.  

One Manhattan West is going up. We did 1.8 million square feet of leasing [at Manhattan West] last year so overall between 5 Manhattan West, 1 Manhattan West and The Lofts building, which is a 200,000-square-foot building that we are repurposing there as well, we are 92.3 percent leased across the project. So we had a really big year there last year.

What else did you do there?

We are about to break ground on a [30-story, 164-room] hotel. We haven’t yet announced the operator. But we hope too soon. So the remaining piece is to lease out the retail. We have signed a couple of retail deals already—like Whole Foods

So the only thing left is 2 Manhattan West—the south tower—where we are actively pursuing tenants. We have started the below-grade work [on that building].

With everything happening in Hudson Yards District, is Midtown East dead?

Between us and Hudson Yards there has been a lot of momentum over there in the last couple of years. [But] the east is not finished yet. There is a bit of a nuclear arms race going on when it comes to upgrading buildings that are somewhat obsolete [in Midtown East]. I think it’ll make those buildings more appealing. Those that don’t spend the capital to reposition their buildings and enhance them, I think are going to struggle a lit bit. But the east is not dead. We just saw the J.P. Morgan announcement [to build new Park Avenue headquarters], which was pretty huge for Park Avenue.  

It’s not exactly Midtown East, but your company now has two buildings off Bryant Park with the Grace Building and the recently acquired neighboring 1100 Avenue of the Americas. Why did you want the adjacent property?

Adjacent and back connected to the Grace Building is the HBO Building, 1100 Avenue of the Americas. There is literally a floor where you could walk from one building to the other.

Interestingly, someone along the chain of ownership built what I’m going to call a “spite wall” on the back of the HBO Building. So when we acquired the Grace Building there was this solid wall that went literally up the north side of the HBO Building.

We were the only one’s pursuing the acquisition of 1100 Avenue of the Americas that could remove that wall [since we also owned the Grace Building], and basically connect the Grace Building plaza to Bryant Park with a renovation of the lobby. The other advantage that we had on that building [1100 Avenue of the Americas] than others is that the building does not have a loading dock. So you literally had to pull a truck up in the middle of the night and offload it to bring goods into the building. We can connect the building to the Grace Building’s loading dock underground.

We saw this as an opportunity to help Bank of America [which is the anchor of 1 Bryant Park] create an urban campus. So they leased the bulk of 1100 [Avenue of the Americas], and also have taken some space in the Grace Building as well.

How is Brookfield Place doing?

So we’ve leased up all of the retail space and the project is 8.5 million square feet and 95 percent leased [in both office and retail]. And I just looked at the [2017] year-end sales numbers before I came here and it had very strong same-store sales.

It really has exceeded our expectations. You can go there on a Friday night, it’ll be crowded. You could go there on a Saturday morning, it’ll be crowded. And it’s a difference; the crowd takes on a different complexion on any day of the week. Sunday morning you’ll see a bunch of dads and strollers. And we are really proud of it.

We’ve heard millennials are to blame for the death of malls. How is Brookfield preparing for the influx of millennials that will reshape the economy?

In a year or two, millennials will make up 50 percent of the world’s working population. And by 2030, it’ll make up 70 percent. So for sure, I think those in the real estate business that are paying attention to that are making adjustments to their real estate to help employees attract, maintain and motivate employees will be more successful.

This crowd was basically born with a smartphone in their hands. And they want everything immediately and they want it efficiently, so we’ve been bringing a lot of innovation and technology to our “places.”

What specifically?

For example, at Brookfield Place we are beta testing an app that will package a bunch of other apps that will provide convenience to those that work within our project. You will soon be able to get in and out of the building by using your smartphone instead of a plastic badge. You will receive security alerts on a moment’s notice if there is some kind of terrorism event or some kind of emergency.

We noticed that when we opened Hudson Eats [in Brookfield Place], between the lunch hours the lines were so long that people were actually turning away. So we found an app called Ritual, with which you can sit at your desk, decide where you want to order your food from, you order your food, the food is prepared, they give you a notice when it is ready. They’ll also let you know if someone else on your floor or in your building is going down to pick up food from there and [inform you if] they’ll bring the food back to you.

Within a couple of months 25 percent of the people that work within Brookfield Place downloaded this app, and sales for the stores that use it went up 25 percent as well. So we are trying to wrap all of those with a Brookfield app just to make the overall experience just as seamless and efficient as we can.

And this is only for Brookfield Place?

We’ve been beta testing this whole thing at Brookfield Place so once we get the bugs out and its working efficiently, we’ll roll it out across the world.

How did you get to know Convene and why is Brookfield so heavily investing in it?

I got a phone call once from a CEO of [Hudson’s Bay Company]—one of our tenants—after we signed a lease with him, saying, “I’m sitting here with my architect and I’m planning my space and I’m planning a boardroom, which I am literally going to use once a quarter. And if you had something where I could rent a catered conference room once a quarter, I could use my space that I rented from you for more productive things.”

And he introduced us to Convene. And we understood the merits of it immediately.

On the one hand, I’m sure our leasing group would rather rent more space to somebody even if it is sitting idle, but I think those that listen to their tenants and solve their tenants’ problems as they relate to efficiency will be more successful.

How much has Brookfield invested in Convene?

We are the largest shareholder now. We sign leases with them in some of our buildings and we do management agreements with them as well. So we think wherever we can work a Convene into our projects it’s a great amenity—one that tenants will respond positively to.

Work space as a service has become huge business with players like WeWork, IWG (Regus) and Convene. Are you afraid that they will take business from traditional landlords?

So for our office business primarily we are in the big-bulk leasing business. So we don’t have a lot of small tenants in our facilities… And for sure the smaller tenants I think—particularly those in a start-up business—need flexibility and I think WeWork or IWG provides that flexibility for those tenants that don’t want to sign a 10-year lease because their business may be very different in a couple of years. I think there is room for both of these. And we are working with a coworking or flexible angle within many of our projects around the world.

Although they have been unsuccessful so far, why has Brookfield made moves to acquire GGP, Forest City Realty and IWG?

So I can’t comment on specific transactions. But I would say [Brookfield Property Partners parent company] Brookfield Asset Management’s real estate business has about $150 billion of assets under management and we got to that scale through [mergers and acquisitions] activity. So we are always looking for mispriced or undervalued opportunities—opportunities where we think either through a better capital structure or because of our operating capabilities or some idea that we have or some synergies with some or our other businesses, we can acquire a business and create value. And I’d say, in all of those transactions that is what we are really focused on. As for the specific ones that you mentioned, we will see.

Source: commercial

USA Arm of Spirits Giant Moving to Grace Building From San Fran

Campari America, the U.S. arm of the spirits company Campari Group, has signed a 10-year, 64,658-square-foot lease at Brookfield Property Partners and The Swig Company’s Grace Building to relocate its headquarters from San Francisco.  

The company, known for brands like Skyy Vodka and Wild Turkey, has been based in San Francisco since 1992. It will occupy the entire 18th and 19th floors in the 48-story building between West 42nd and West 43rd Street near Bryant Park when it moves in the fall, according to a news release from Brookfield.

The entire U.S. team, comprising 165 employees, is moving to the building, which has an official address of 1114 Avenue of the Americas.

Campari executives expect the new location will boost its connectivity with its other offices, as it puts the Grace Building office closer to its worldwide Milan headquarters, and operations in Kentucky, Jamaica, Mexico and Canada, according to Jean Jacques Dubau, the managing director of Campari Group’s business unit in North America.

“This move will help to increase collaboration with key business partners and our Milan counterparts; allow us to more easily hire candidates with deep spirits experience; and give us the room to expand as we grow our portfolio of premium brands,” Dubau said in a prepared statement.

Gensler has been selected to design the new Campari America office. Colliers International’s Joseph Cabrera, David Glassman, Tim Kuhn, Brendan Cavender and Steve Maneri handled the deal for Campari America. CBRE’s Ken Rapp, Sarah Pontius, Peter Turchin, Zak Snider and Cara Chayet represented Brookfield. Spokespersons for the brokerages did not immediately return requests for comment.

The asking rent in the deal was not immediately clear. However, in a recent Bank of America deal at the 1.6-million-square-foot tower, the starting rent was $70s per square foot, as Commercial Observer previously reported. And Humanscale, a designer and manufacturer of office products, signed a 33,000-square-foot lease to move its headquarters to the Grace Building. The asking rent in that deal was in the high-$80s per square foot, as CO reported last month.

Retail tenants in the building include Gabriel Kreuther, Bluestone Lane, Joe & the Juice, Sweetgreen and STK.

Source: commercial

Uber Takes 35K SF at 1400 Bway for Second Manhattan HQ

Uber is cruising into new digs spanning nearly 35,000 square feet at 1400 Broadway.

The San Francisco-based ride-hailing company has taken 34,600 square feet on the entire 12th floor at the building between West 38th and West 39th Streets, landlord Empire State Realty Trust told Commercial Observer.

The office will serve as Uber’s second Manhattan headquarters, primarily housing Uber’s engineering team, according to The New York Post, which first reported news of the deal. Uber’s other Manhattan space is about 52,000 square feet inside The Terminal Stores warehouse complex at 636-638 West 28th Street in Chelsea, as CO previously reported.

Marc Donner, Uber’s director of engineering, said in a prepared statement provided to CO: “New York City has become the tech hub of the East Coast and we are excited to expand our engineering footprint here. With this new space, we plan to grow our engineering office and attract the top tech talent in the city.”

The asking rent in the 1400 Broadway deal was $62 per square feet, an ESRT spokeswoman said, declining to provide the length of the lease.

Thomas P. Durels, the director of leasing and operations for ESRT, said in a prepared statement: “In addition to the desirable location, 1400 Broadway has been modernized for the 21st century; will soon feature an expanded lobby and is located in the convenient Times Square South neighborhood just steps from Bryant Park.”

The building at 1400 Broadway is 37 stories and 927,683 square feet. As CO reported last September, immigration law firm Fragomen, Del Rey, Bernsen & Loewy leased three full floors at the property. That lease was for 16 years.

CBRE’s Sacha Zarba and Alice Fair represented Uber in the deal. The brokers declined to comment via a spokeswoman. ESRT’s Keith Cody represented the landlord in-house, along with Newmark Knight Frank’s Scott Klau, Erik Harris and Neil Rubin. A spokesman for NKF didn’t immediately respond to a request for comment.

Source: commercial

Humanscale Nabs 33K SF for New HQ at Grace Building

Humanscale, a designer and manufacturer of ergonomic office products, will be relocating its U.S. headquarters from 11 East 26th Street to the Grace Building, Commercial Observer has learned.

The company has leased 33,000 square feet for the entire 15th floor at the Midtown West building with an address 1114 Avenue of the Americas on Bryant Park. The deal is for 10 years, according to Brookfield Property Partners, which owns the building with The Swig Company. The space will house Humanscale’s headquarters as well as a design studio.

Brookfield declined to provide the rent, but on the building’s lower floors, the asking rent is in the high-$80s per square foot.

“Our new headquarters in the Grace Building represents a great opportunity for Humanscale to establish a space that is welcoming to our clients and reflects the values of our brand,” Humanscale Founder and CEO Robert King said in a statement. “The location of this iconic New York building will be a great benefit for our team as we open it up to more visitors and events.”

Once Humanscale moves in later this year, it will be able to have all employees on one floor. “Most importantly to King, the new location will feature a design that speaks to the brand’s core values: functionality, simplicity, longevity and sustainability,” according to a press release from Brookfield.

The property between West 42nd and West 43rd Streets is a 49-story, 1.6-million-square-foot office building, which includes 42,000 square feet of retail and a 30,000-square-foot outdoor plaza. Tenants include Gabriel Kreuther, Bluestone Lane, Joe & the Juice, Kreuther Handcrafted Chocolate, Sweetgreen and STK.

“In addition to designing and manufacturing high-performance products that are simple, functional and that stand the test of time, we are committed to achieving a net positive impact on the earth,” King said in prepared remarks. “This imperative will be top of mind as we specify products and materials for the new space.”

JLL’s Deb van der Hayden and Paul Ferraro represented Humanscale in the deal. Brookfield was represented in-house by Duncan McCuaig and Alex Liscio, alongside CBRE’s Ken Rapp, Peter Turchin, Sara Pontius, Zak Snider and Cara Chayet. Spokespeople for JLL, CBRE and Humanscale didn’t respond with a comment.

Source: commercial

Energy and Metals Data Provider Inks Lease Extension Near Bryant Park

Advisory and analytics company Wood Mackenzie has signed an early five-year renewal for its 10,338-square-foot offices at 452 Fifth Avenue, Commercial Observer has learned.

The company, which serves the oil, gas, metals and coal industries, will continue to occupy part of the 21st floor of the 30-story building between West 39th and West 40th Streets near Bryant Park.

Eli Elefant and Alicia Popper of landlord PBC USA—the U.S. arm of Tel Aviv-based Property & Building Corporation—represented the landlord in-house alongside JLL’s Paul Glickman and Jonathan Fanuzzi. Tucker Shade and Gabe Marens of Savills Studley handled the deal for the tenant.

Wood Mackenzie has been in the building since 2012. Its extension begins in January 2018. The asking rent in the deal was not immediately clear. But Popper, a senior vice president at PBC, indicated that taking rents in the building can notch $100 per square foot.

“The Wood Mackenzie commitment not only solidifies the great relationship we have established between ownership and our tenants at 452 Fifth Avenue through stellar management, but also our continued achievement of triple-digit rents and 100 percent occupancy,” Popper said in a prepared statement.

PBC acquired the 865,000-square-foot office tower at 452 Fifth Avenue in April 2010 for $330 million from HSBC in a sale-leaseback deal, as the company announced at the time. It then completed a $45 million renovation of the building, which included a new multi-floor lobby, upgrades to the elevators and new emergency power generators.

The property is still anchored by HSBC, which signed a 548,000-square-foot lease renewal there in April for its U.S. headquarters, as CO previously reported.

The Savills Studley brokers did not immediately respond to a request for comment via a spokeswoman.


Source: commercial

Renfro Corporation Inks 29K-SF Deal at 1400 Broadway


Source: commercial

Schlesinger Takes Full Floor at SL Green’s 711 Third Avenue


Source: commercial

Office Provider Breather Branches Out in Midtown, Soho, Financial District


Source: commercial

With Retail Writhing, What’s the Secret of a Successful Mall?


Source: commercial