Hovnanian renews lease at GM building

Home builder Hovnanian Enterprises has agreed to pay $175 per square foot to Boston Properties in a five-year deal for the renewal of its lease at 767 Fifth Avenue, on the 46th floor of the General Motors building.

The arrangement seems strange, Crain’s said, given that Hovnanian has been suffering enormous losses of late; the company’s stock fell 28 percent in the last 12 months and it endured a fiscal first-quarter loss of $64 million, down from the previous year’s profit of $236 million.

This rate of $175 per square foot is more consistent with the rents of huge hedge funds and private equity firms, according to Crain’s.

Boston Properties bought the GM Building for a record $2.8 billion in 2008. Fao Schwarz, which is in the same building, also negotiated an extension on their lease in March. [Crain’s]