park avenue office space

Lender Varagon Capital Inks 28K-SF Deal to Relocate Within Midtown



Varagon Capital Partners, an asset manager that focuses on lending to middle-market companies, has signed a 28,316-square-foot deal at Fisher Brother’s 299 Park Avenue to relocate its offices, Commercial Observer has learned.

The lender will occupy the entire third floor of the 42-story, 1.2-million-square-foot building between East 48th and East 49th Streets.

The asking rent in the deal was in the high $80s per square foot, according to a source with knowledge of the transaction. The length of the deal was not immediately clear. 

Varagon was formed in 2014 with backing from American International Group and affiliates of Oak Hill Capital Management. It is moving from the 22nd floor of 488 Madison Avenue between East 51st and East 52nd Streets by the end of this year. There the company has 10,360 square feet, according to CoStar Group.

CBRE’s Leo Paytas and Conor Denihan handled the deal for Varagon. Fisher Brothers was represented in-house by Marc Packman and Clark Briffel, and a Newmark Knight Frank team led of David FalkPeter ShimkinAndrew SachsEric Cagner and Andrew Peretz. Representatives for CBRE and NKF did not immediately return requests for comment and information.

Fisher Brothers expects to begin a David Rockwell-designed renovation of 299 Park Avenue early next year, which will include a new lobby, revitalized entrance that will allow more light from outside and an illuminated plaza. The work will cost approximately $20 million.

“Our capital improvement program at 299 Park Avenue is going much deeper than a standard refresh and completely transforming the aesthetic of the building with a sleek design and modern feel,” Winston Fisher, a partner at Fisher Brothers, said in a prepared statement. “We are pleased to welcome Varagon to the growing roster of blue-chip tenants [at] 299 Park Avenue.”

Existing tenants in the 1967 building include Capital One and UBS.

Wealth Management Firm for Blackstone Co-Founder Moves Within Midtown



Peterson Management, which manages the family assets of Peter Peterson,Blackstone Group co-founder and former Lehman Brothers chief executive officer, is heading to the former Citigroup headquarters on Park Avenue.

The firm will relocate from 26,000 square feet at Paramount Group’s 712 Fifth Avenue to 40,000 square feet of offices at Boston Properties’ 399 Park Avenue, The Real Deal reported. The outfit led by Peterson’s son, Michael Peterson, will set up shop in a penthouse-like space that includes outdoor terraces and a glass box constructed on top of the building’s setback. Rents in the 15-year lease start at $130 a square foot and rise to $150 a square foot towards the end of the term, according to TRD.

Seth Hecht of Cushman & Wakefield and Joseph Conwell of Philadelphia-based GPX Realty Partners represented Peterson. (GPX Realty is a subsidiary of private investment firm GPX Enterprises, another company headed by Michael Peterson.) It wasn’t immediately clear who represented the landlord.

A spokesman for C&W declined to comment, and Boston Properties’ spokeswoman didn’t respond to a request for comment.

The wealth management company will relocate along with the nonprofit Peterson Foundation, which Peter Peterson launched in 2008 to focus on fiscal sustainability and national debt.


Three Financial Services Firms Ink New Office Leases at 600 Lex

SL Green Realty Corp. has signed three new financial services tenants at its 600 Lexington Avenue office tower in Midtown East, the real estate investment trust announced today.

In the largest deal, investment banking advisory firm GLC Advisors & Co. took 12,487 square feet comprising the entire ninth floor of the 36-story, 305,000-square-foot property on the northwest corner of East 52nd Street. GLC signed the seven-year lease, which will commence in December, late last month and will move to 600 Lexington Avenue from its current location at Cohen Brothers Realty Corp.’s 805 Third Avenue.

Private equity firm NexPhase Capital, meanwhile, inked a five-year lease for the entire, 8,607-square-foot 12th floor at the building. The deal, which was signed this week, is anticipated to commence at the beginning of November and will see NexPhase relocate from Boston Properties’ 399 Park Avenue.

Finally, alternative investment manager KCL Capital signed a five-year deal to take the entire 6,780-square-foot 28th floor at 600 Lexington Avenue. The transaction was sealed late last month, with KCL’s lease expected to commence in the middle of October. The company’s current location was not disclosed.

Asking rent in the transactions ranged from the low $70s to mid-$80s per square foot, according to sources with knowledge of the deals. A JLL team of Paul GlickmanDiana BiasottiJonathan Fanuzzi and Ben Bass represented SL Green in the transactions. Daniel Posy and Jason Roberts of Savills Studley handled the GLC and KCL leases for the tenants, while Newmark Knight Frank’s Brian Goldman and Eric Cagner worked on behalf of NexPhase.

The deals take 600 Lexington Avenue to “nearly 99 percent occupancy,” Steven Durels, SL Green executive vice president and director of leasing and real property, said in a statement. Durels added that the building’s “efficient, small floors with floor-to-ceiling windows and white glove service” have proven “highly appealing to upscale tenants.”

Tenants at the property include hedge funds MKP Capital ManagementElement Capital and LibreMax Capital.


Vornado, SL Green land private equity tenant at 280 Park

Antares Capital signs 12-year lease for 55K sf

280 Park Avenue in Midtown

280 Park Avenue in Midtown

Private equity firm Antares Capital signed a 55,000-square-foot lease at Vornado Realty Trust and SL Green Realty’s 280 Park Avenue.

The lease is for 12 years and asking rents in the building are in the $90s. Antares is moving from Fisher Brothers’  299 Park Avenue.

The firm was a subsidiary of now-defunct GE Capital until last year, when it was sold to Canada Pension Plan Investment Board as part of a $12 billion deal. CBRE’s Paul Amrich and Neil King represented Antares, while Vornado’s Andrew Ackerman and CBRE’s Peter Turchin and Sam Seiler represented the landlord.

SL Green and Vornado spent $150 million renovating the 1.2 million-square-foot property, which they bought for close to $500 million in 2011.

The building will be the new home of the Four Seasons Restaurant, which was kicked out of RFR Realty’s Seagram Building.

Last year, Singapore’s sovereign wealth fund GIC signed a 50,000-square-foot lease at the tower.  [Crain’s] — Konrad Putzier

BlackRock's relocation would shake city's office market and policymakers

BlackRock's plan to trade Park Avenue for Hudson Yards reveals the cracks in the commercial real estate landscape.

BlackRock's plan to trade Park Avenue for Hudson Yards reveals the cracks in the commercial real estate landscape.

Whenever BlackRock speaks, the markets quake. When BlackRock picks a location for its headquarters, the city’s office market will tremble. And the de Blasio administration could find itself under an unwelcome spotlight.

Consider this a tale of the city’s three most important office markets.

BlackRock—one of the world’s largest money managers—occupies two buildings just off Park Avenue, once the most prestigious address in midtown. But employers including Citigroup and Major League Baseball have been leaving midtown east because the buildings there are old—66 ½ years, on average—and outmoded for the way large corporations configure their operations.

BlackRock considered and then ruled out anchoring Larry Silverstein’s 2 World Trade Center tower. In January, Fox and News Corp. similarly backed out of an almost-completed deal to move to the building, which offers low rents through large city subsidies.

Now BlackRock is eyeing the far West Side. It could relocate to Hudson Yards, the great legacy of the Bloomberg administration, or to a tower that Tishman Speyer is planning one block north. It would be in good company at either location, as Hudson Yards’ developer, the Related Cos., haslured a list of well-known names: Coach, Milbank Tweed, KKR, SAP and Time Warner, to name a few. They are moving into the most modern office space anywhere, helped by significant tax breaks.
Although BlackRock might stay in midtown, as Fox and News Corp. did, the odds of a move seem good.

Here’s what the BlackRock story tells us about the city’s three major office districts:

  • Downtown continues to struggle to lure the high-profile, big-name tenants it needs to fill the new skyscrapers at the World Trade Center site. Whether it can do so remains an open question, especially if the city’s economy weakens.
  • The far West Side is established as the go-to location for successful companies that want to make it clear they are the best in their business. Its future seems secure.
  • Midtown east is in danger of seeing its tenants slip away unless the de Blasio administration can finally push through a rezoning to allow a handful of new office buildings and modernization of old ones—something the Bloomberg administration failed at three years ago.

The de Blasio administration did green-light the SL Green Tower opposite Grand Central Terminal in a nifty deal that produced at least $220 million in improvements at the transit hub. But one building won’t solve the problem.

The latest de Blasio proposal seems to have broader support, possibly because it is forgoing money for transit improvements to instead help the landmark churches in the area sell their air rights—a decision made to neutralize a potential opponent. But it has been three years since the Bloomberg midtown east effort crashed. Time is a-wasting for the help the area needs.

Park Avenue braces for 2M sf of empty office space

Citibank, Major League Baseball plan to move in next few years

It may get a whole lot easier to find office space on Park Avenue pretty soon, as a series of upcoming departures is set to leave landlords with roughly 2 million square feet to fill.

From left: 277 Park Avenue, 270 Park Avenue, 299 Park Avenue and 425 Park Avenue

From left: 277 Park Avenue, 270 Park Avenue, 299 Park Avenue and 425 Park Avenue

The vacancies — courtesy of tenants like Citibank, Major League Baseball and others — could impact 10 percent of the office submarket, which stretches from East 45th to East 59th streets, Crain’s reported.

In addition to Citibank and MLB, other major tenants are weighing their options, including investment firm BlackRock , which could leave its 700,000 square foot digs at 345 Park and 40 East 52nd Avenue and move to Hudson Yards or the World Trade Center when its lease expires in 2023. JPMorgan Chase, meanwhile, is planning to leave its 300,000-square-foot digs at 277 Park in order to consolidate at 270 Park and 383 Madison Avenue.”What you’re seeing is a migration to newer product,” said CBRE’s Mary Ann Tighe. “The age of these buildings is catching up to them.”

According to data from Cushman & Wakefield, Park Avenue offices have an average age of 55.6 years, and many have lower ceilings and structural columns. Meanwhile, many finance companies — which currently occupy roughly 70 percent of Park Avenue’s 22 million square feet of space — are weighing smaller spaces in light of shrinking profits.

Landlords say the vacancies are a number of years away, giving them ample time to find new tenants. And some are looking at the impending vacancies as an opportunity to upgrade their properties or diversify their tenant base.

At 299 Park, Boston Properties is spending $50 million to upgrade the building after Citibank vacates 385,000 square feet next year. “Large tenants have left Park Avenue before, and the space always gets filled,” said John Powers, who heads Boston Properties’ New York office.

Meanwhile, L&L Holding Co. is currently building 425 Park, a 670,000-square-foot tower where hedge fund Citadel has already committed to 200,000 square feet at an average of $175 per foot, including a penthouse space that rents for roughly $300 per square foot.

And Vornado Realty Trust — responding to expectations that the city could rezone part of Midtown East — is attaching clauses to its leases at 350 Park to allow it to clear out the building and replace it with a state-of-the-art spire.

[Crain’s]E.B. Solomont, The Real Deal, August 22, 2016 11:00AM

Winton Capital leaves Seagram Building for 315 PAS

Hedge fund to take 35K sf at Columbia Property Trust tower

315 Park Ave South in NoMad (inset from top: Winton Capital’s David Harding and Columbia Property Trust’s Nelson Mills)

315 Park Ave South in NoMad (inset from top: Winton Capital’s David Harding and Columbia Property Trust’s Nelson Mills)

U.K.-based hedge fund Winton Capital is relocating from the Seagram Building to 315 Park Avenue South in Midtown South.

The investment firm signed a 10-year lease for 34,844 square feet at Columbia Property Trust’s under-renovation office tower, according to the Wall Street Journal. Columbia CEO Nelson Mills said the move was a “badge of honor” for 315 Park.

Winton will have a private elevator, lobby and elevators in the 328,193-square-foot building. The asking rent for the space was $105 per square foot.

Columbia, a real estate investment trust, paid $375 million to buy the 20-story pre-war building from Spear Street Capital in 2014. L&L Holding Company manages the property and handles leasing services.

Spear Street bought the building in 2013 from Craig Nassi’s BCN Development for $250 million.
Columbia has also reeled in new tenants including Equinox, which is taking 44,000 square feet, and Fullscreen, a YouTube channel aggregator that’s taking 17,000 square feet.  Oracle Corp. plans to expand its footprint there, as well.

Stat of the Week: $20.16 Per Square Foot

As the “unofficial” start to the summer season approaches, what better way to celebrate Memorial Day weekend than by heading outdoors for some fun in the sun? Since it’s not quite warm enough to head to the beach, let’s stroll through some of Manhattan’s most famous parks and enjoy the cool breeze and greenery. Everyone knows office buildings with views of the 843-acre Central Park command a premium compared to the rest of the office leasing market. Analyzing the office buildings around three other parks within Midtown and Midtown South uncover similar results, as the average asking rent of $92.16 per square foot for buildings surrounding Union Square, Madison Square and Bryant Park are $20.16 per square foot higher than the Manhattan average.

The first park on the list is Union Square Park, which is bordered by 10 office buildings totaling more than 978,000 square feet. Currently there is more than 79,000 square feet of vacant office space in this park set, for a vacancy rate of 8.1 percent. Despite a vacancy rate higher than Midtown South’s 6.1 percent vacancy, at $74.94 per square foot, asking rents in these buildings are $5.01 higher than the Midtown South average.

The second park examined is Madison Square Park, which is surrounded by 12 buildings totaling more than 6.9 million square feet. This park set is extremely tight with only 169,115 square feet of vacant space—a 2.4 percent vacancy rate—370 basis points lower than Midtown South. Asking rents in these buildings are averaging $77.86 per square foot, a $7.93 premium over the Midtown South average of $69.93 per square foot.

The last park analyzed, Bryant Park, resides within Midtown, and this park set contains 20 buildings totaling more than 9.6 million square feet. Despite having the highest vacancy of the three park sets, at 9.3 percent it is still 10 basis points lower than Midtown’s 9.4 percent vacancy. In the Bryant Park set, asking rents are $101.91 per square foot and command a $23.12 premium over the $78.79 per square foot Midtown average.

So, as you stroll through Manhattan’s parks this season, keep in mind that even though money doesn’t grow on trees, you need quite a bit to look at them from your office window.

Visa swipes in at 277 Park Avenue

Credit card processor inks 25K sf lease at Stahl’s Plaza District tower

277 Park Avenue

277 Park Avenue

If the Stahl Organization were looking for a slogan for its 2.1 million-square-foot office tower at 277 Park Avenue, it could try, “Everywhere you want to be.”

Financial services firm Visa, best known for its branded debit and credit cards, inked a lease for the full, 25,000 square-foot 50th floor near the top of Stahl’s Plaza District tower, sources told The Real Deal.

The asking rent for the 10-year deal was $125 per square foot.

A team at Cushman & Wakefield including Peter Occhi, Mark Boisi and James Frederick represented the landlord. David Hollander at CBRE negotiated the deal on behalf of Visa.

The brokers declined to comment.

The space, which boasts dramatic double-height ceilings, became available for the first time in half a century two years ago as one half of a 50,000 square-foot penthouse on the 49th and 50th floors. That was when the Continental Grain Company relocated to the General Motors Building at 767 Fifth Avenue.

The 49th Floor remains on the market, according to CoStar.

Back in 2014, Visa dropped the “It’s” from the company’s popular slogan, abbreviating it to simply: “Everywhere you want to be.”

The company is relocating from the William Kaufman Organization’s 777 Third Avenue, where it currently occupies 10,810 square feet on part of the building’s 23rd Floor. That space is now available for sublease, with a term running through 2023.

277 Park is also home to Stahl’s headquarters.

Other tenants in the building include JP Morgan Chase, which has 571,000 square feet in the tower, and Sumitomo Mitsui Bank Corporation, a subsidiary of Japan’s fourth-largest bank.

Four Seasons restaurant finds new home at 280 Park

Iconic eatery signed 19K sf lease at building owned by Vornado, SL Green

From left: The Four Seasons restaurant and 280 Park Avenue

From left: The Four Seasons restaurant and 280 Park Avenue

After getting the boot by Aby Rosen, the Four Seasons restaurant found a new home at SL Green Realty and Vornado Realty Trust’s 280 Park Avenue.

According to sources cited by the New York Post, the restaurant’s owners Julian Niccolini and Alex von Bidder signed a lease for a 19,000-square-foot lease at the office building. Brazilian architect Isay Weinfeld will design the new restaurant.

Rosen and Michael Fuchs’ RFR Realty last year announced it would not renew the restaurant’s lease at the Seagram Building, which had been its home since 1959. The restaurant’s lease ends July 31, and Rosen has been reportedly looking to raise $30 million to renovate the space.

Classic Restaurants, which owns the restaurant, trademarked the names of the Pool Room and the Grill Room last year when it realized it would not be staying at 375 Park Avenue. [NYPost] – Konrad Putzier

Division of Wells Fargo Re-Ups Its 103K SF at SL Green’s 100 Park Avenue



Wells Fargo Capital Finance has renewed a lease for its three floors of office space at SL Green Realty Corp.'s 100 Park Avenue.

The real estate investment trust announced the extension in its report on 2016’s first quarter, during which the landlord completed roughly 850,000 square feet of leases in Manhattan. That was carried in part by Wells Fargo’s 103,000-square-foot renewal for another five years and seven months.

Asking rent in the deal was not immediately clear, and nor was whether brokers were involved in the deal.

The asset-based lending wing of the banking giant first signed a 57,000-square-foot lease at the 887,489-square-foot property between East 40th and East 41st Streets about six years ago, according to CoStar Group.

Wells Fargo moved into the building in June 2009. The lender expanded by 12,000 square feet in December 2010, CoStar indicates. By February 2011, it tacked on an additional 34,000 square feet for its current foothold.

SL Green announced the renewal as part of a slew of transactions it has already completed in 2016. Executives said on an earnings call today that the leasing target for this year is 2 million square feet, with more than one-third of that already completed. There are another 1.3 million square feet of deals in talks right now, of which about 650,000 square feet are new, said SL Green Chief Executive Officer Marc Holliday, who recently clocked in at three on this year’s Power 100.

The first-quarter leasing would thus cover a third of what SL Green hopes to accomplish this year. Other heavyweight deals between January and March this year include Omnicom Group’s 167,000-square-foot renewal at 220 East 42nd Street and Credit Suisse’s two-floor re-signing of 186,396 square feet at 11 Madison Avenue, as Commercial Observer previously reported.

“The stars aligned and we ended up converting a lot of those transactions further,” Steven Durels, SL Green’s leasing chief, said of the leases already signed this year.  

UBS Does About-Face and Leases 120K SF at Park Avenue Building

299 Park Avenue (Photo: CoStar Group).

299 Park Avenue (Photo: CoStar Group).

Swiss bank UBS AG, which in early 2013 had plans to leave 800,000 square feet, or 30 floors, at Fisher Brothers299 Park Avenue, has leased 120,000 square feet in the Midtown tower, Winston Fisher, a partner in the firm, told Commercial Observer.

“This [deal involves] taking a new 120,000 square feet that we had never anticipated,” Mr. Fisher said of last week’s lease signing. “We’re delighted to have [UBS].”

The Real Deal broke the news that UBS signed a 13-year deal with a five-year extension for floors eight, nine, 24 and 25 in the 42-story, 1.2-million-square foot building between East 48th and East 49th Streets. Asking rents in the building, with floor plates of about 25,000 square feet, range from $90 to $135 per square foot, a source with knowledge of the deal told CO.

Fisher Brothers faced having to lease 30 empty floors in the 42-story tower, dubbed the UBS Building, following Switzerland’s largest bank’s decision to cut jobs and consolidate, Mr. Fisher said. Now, two years before the company’s lease expiration, Fisher Brothers has 27 of those floors spoken for. Capital One took 250,000 square feet of UBS’ space, GE Capital took 115,000 square feet and the Carlyle Group leased 60,000. UBS has been a tenant in the building since 1981.

Marc Packman represented Fisher Brothers in-house. Robert Alexander, Doug Lehman and Patrick Murphy of CBRE represented the tenant and they declined to comment via a spokeswoman.

Built and managed by Fisher Brothers and designed by Emery Roth & Sons, the tower opened in 1967. Alaska Permanent Fund Corporation has a 49.5 percent interest in the property, according to CoStar Group.

Private Equity Firm Goes Block North in Park Avenue Relocation



A private equity firm is relocating north in Midtown to take an entire floor at the 2.1-million-square-foot 277 Park Avenue, Commercial Observer has learned.  

CCMP Capital Advisors has signed a 23,163-square-foot lease for the whole 27th floor of the 50-story tower between East 47th and East 48th Streets, according to a press release from Cushman & Wakefield. The firm is currently located one block south at 245 Park Avenue between East 46th and East 47th Streets. It wasn’t clear how many square feet CCMP Capital Advisors currently leases.

C&W did not immediately provide the length of the lease, but the release indicated that the asking rent in the deal was $95 per square foot.

“277 Park Avenue is a highly coveted address,” David Hoffman of C&W said in prepared remarks. “One that will allow CCMP to remain in close proximity to Grand Central Terminal, while consolidating its employees on one full floor.”

Mr. Hoffman represented the tenant with colleague Bryan Boisi. Mark Boisi, James Frederick and Peter Occhi of C&W represent the landlord, Stahl Organization, in leases at the building, according to CoStar Group. The brokerage declined to comment further via a spokesman.

CCMP Capital Advisors, which was founded in 1984, is joining tenants at 277 Park Avenue such as J.P. Morgan Chase, law firm Cozen O’Connor, MetLife and Sumitomo Mitsui Banking Corporation. The Manhattan Athletic Club, a high-end fitness center, is located at the base of the building, according to the release.

Blackstone Triples Foothold at 601 Lexington

Blackstone Group has tripled its office size at Boston Properties601 Lexington Avenue by exercising its expansion option.

The investment powerhouse has inked a 10-year deal to grow its space by 60,000 square feet on the 15th and 16th floors, according to CoStar. This puts Blackstone at almost 90,000 square feet in the 1.7-million-square-foot tower between East 53rd and East 54th Streets. The firm is expected to move into the new space next February.

Blackstone in February signed a lease for 30,000 square feet on the 17th floor of the building, also known as the Citigroup Center, according to The New York Post, which first reported news of the deal. Rent in that space is $78.50 per square foot, according to CoStar.

David Kleiner, Cynthia Wasserberger and Frank Doyle of JLL represented Boston Properties in the new deal. Neil Goldmacher and Mark Weiss of Newmark Grubb Knight Frank represented Blackstone.

The JLL brokers were not immediately available. NGKF declined to comment via a spokeswoman.

Boston Properties seems to be having a bullish year with leasing at the building. In January, it signed a 20-year extension with law firm Kirkland & Ellis, one of its two anchor tenants, for 403,000 square feet across six floors. Apax Partners in March renewed its 31,400-square-foot lease for another 10 years.

Blackstone meanwhile has been leasing more and more space over the last year. On top of the 90,000 square feet at 601 Lexington Avenue, the investment powerhouse leases 489,500 square feet at 345 Park Avenue. The most recent addition to that massive foothold was a May 2014 expansion for 38,850 square feet.