Third Avenue’s weak office marketcompelled the Durst Organization to take a different approach to finding tenants for its building at 205 East 42nd Street, where Pfizer vacated about 250,000 square feet two years ago. It decided to try and sell the space rather than lease it. Now, the Wall Street Journal reported that the landlord has found a buyer for 170,000 square feet of the space in the City University of New York.
CUNY had previously been rumored to be in talks for the space, but now a sale is official. Though the terms of the agreement were not disclosed, Durst Organization said it would regain control of the space in 30 years.
“If it were a tight market it would be very easy [to lease it]. We had to think outside of the box,” Tom Bow, a senior vice president at the Durst Organization, told the Journal. Since 2008 the vacancy rate on the east side of Midtown has increased to 10.7 percent from 8.1 percent, while rents have plummeted by $19 a foot to $57.
As CUNY takes this office space, the Journal said it would look to sell a seven-story building it owns at East End Avenue and 80th Street that could become a 200,000-square-foot development site. CUNY hopes to use the proceeds to build a science center in Harlem. [WSJ] — Adam Fusfeld