The Real Deal New York

Caerus buys Midtown office building from Brause for $52M

10-story, 55K sf property was set to see 60% of tenant leases expire this year

February 29, 2016 06:25PM
By Rey Mashayekhi

10 East 34th Street

10 East 34th Street in Midtown (inset, from left: Leo Tsimmer and David Brause)

UPDATED, 8:45 p.m., Feb. 29: Leo Tsimmer’s Caerus Group acquired a 10-story Midtown office building from Brause Realty for $51.7 million, or about $940 per square foot, according to property records filed with the city Monday.

Caerus, a Midtown-based firm real estate investment firm, closed on its purchase of the 55,000-square foot property at 10 East 34th Street, between Fifth and Madison avenues, on Feb. 16.

Caerus confirmed the deal, saying in a statement that it “intends to reposition the asset as a boutique 60,000-square-foot office building.” The company noted the property’s “high-ceiling, floor-through office lofts” as features that make it “particularly appealing to media, technology and showroom tenants.”

Brause tapped a Cushman & Wakefield team led by Bob Knakal last June to market the office property, where about 60 percent of the leases were due to expire at the start of this year.

In the marketing materials, the looming vacancies at 10 East 34th Street were depicted as a positive — allowing prospective landlords an opportunity to capitalize on rising Manhattan office rents and offering the potential of a residential or hotel conversion.

Neither Brause nor Cushman & Wakefield returned requests for comment.

Caerus previously entered contract to acquire a nearby office building at 4 East 34th Street, which formerly served as the Zionist Organization of America’s headquarters. Tsimmer’s firm also partnered with Samson Klugman’s Quality Capital to acquire a pair of mixed-use East Village buildings for $60 million in August.

Brause, a Midtown-based, family-run firm, recently secured a $105 million construction loan for its new 270-unit apartment building in Long Island City. The company is co-developing the project with the Gotham Organization.