Normandy Real Estate Partners has gone into contract to purchase a 275,000-square-foot, 16-story office building at 1370 Broadway and 37th Street for $125 million, according to the New York Post. Sources said the building was snapped up by the company just before Thanksgiving.

As The Real Deal previously reported, the seller, Sitt Asset Management, had been soliciting bids for the building in October. CoStar Group data shows the property has about 22 percent of its space available to lease. Large tenants there include apparel retailer Esprit and executive office firm Jay Suites. [more]

President Obama and Midtown Manhattan

Now that the debt ceiling has been raised and budget cuts have been agreed upon, the real estate industry’s focus shifts to how the new legislation will affect the commercial market. And according to Chris Macke, a senior real estate strategist at the CoStar Group, in an article for Forbes, that all depends on whether the economy has slumped because of a reduction in demand, or because federal spending has corporations concerned over forthcoming tax hikes.

If it’s the former, then the commercial real estate market could be in for a rude awakening. With the federal government spending $2.7 trillion less over the next decade, or $270 billion less per year, many private sector companies who do big business with the government will find their revenues slashed. In that case, corporate America certainly would not increase hiring and demand for commercial real estate would be stifled. [more]

Top row, from left: Mitchell Konsker, Paul Glickman, Mitti Liebersohn and Alex Chudnoff. Bottom row, from left: 99 Park Avenue, 1290 Sixth Avenue, 681 Fifth Avenue and 1411 Broadway

Following the exit by five major leasing brokers from Cushman & Wakefield to Jones Lang LaSalle last month, there has been a behind-the-scenes battle over who is the landlord leasing representative for millions of square feet of Manhattan office space that had been handled by Cushman.

In that contest, JLL has picked up at least three buildings owned by Midtown-based Eastgate Realty with more than 1.7 million square feet.

The buildings are the 550,000-square-foot 99 Park Avenue, the 530,000-square-foot 120 Park Avenue and 665,000-square-foot 875 Third Avenue, data from CoStar Group shows. [more]

Commercial services firm CB Richard Ellis represented the tenants in
seven of the 10 largest office leasing deals that closed in the first
half of 2010,
up from three of the top leasing deals in same period last year, a
CoStar Group ranking of the top 50 leasing deals published today in
Crain’s shows. CBRE dominated the upper tier of leases with the top four tenants:
Proskauer Rose, Polo Ralph Lauren, Showtime and Beijing Vantone Real
Estate. [more]

From left, Charles Kushner, chairman of Kushner Companies, company principal and son Jared Kushner and 666 Fifth Avenue

The $1.215 billion securitized loan secured by the Kushner Companies
iconic Midtown office building at 666 Fifth Avenue was transferred to
special servicing yesterday as part of an effort to restructure the
loan, a company spokesperson told The Real Deal in a statement. Kushner
bought the building, located between 52nd and 53rd streets, for $1.8
billion from Tishman Speyer Properties in January 2007, at the time the
highest price ever paid for an office building. “The transfer of
the 666 Fifth Avenue loan was done at the request of Kushner Companies,
so that it could more easily engage in productive discussions with the
lender. The loan is not currently in default,” the statement said. Peter
Slatin, editorial director of commercial data tracking firm Real
Capital Analytics said the move was part of a trend in owners seeking
to reduce their debt. “They are clearly hoping to take advantage
of the increasing willingness of lenders to restructure to avoid what
could be a challenging situation since they not only bought at the top
of the market, they defined the top of the market,” Slatin said. [more]

From the March issue: Although they may be just beguiling mirages that will fade upon approach, there are some submarkets where asking rents have jumped in the past months, a trend that runs counter to the dour predictions from Manhattan leasing brokers that taking rents won’t rise for more than a year.

In the Meatpacking District, for example, Charles Blaichman’s CB Developers High Line building that remains under construction at 450 West 14th Street has asking rents above $100 per square foot. The space was added to the availability list in January, driving up average rates in the district, the most recent figures from commercial firm Jones Lang LaSalle show.

And in the Union Square submarket, the average asking rent rose by 14 percent with the addition of space at 300 Park Avenue South, commercial firm CB Richard Ellis’ latest report said.
[more]

Chart clarification: While CBRE data puts Durst’s portfolio at 7.2 million square feet, a Durst spokesperson later said that figure is actually 9 million.

Asking rents plunged for some of Midtown’s top landlords last year as they competed for the few tenants searching for space in a weak leasing market, but their reductions helped keep their vacancy rates below the market average, experts said. The family-owned Durst Organization dropped its asking rents to $60.82 per square foot in November 2009 from $113.15 per square foot in August 2008, near the pricing peak of the leasing market, according to the most recent data available on Midtown’s top 10 landlords from commercial services firm CB Richard Ellis. The Real Deal compared data from August 2008 to November 2009 for the top 10 landlords in Midtown ranked by square feet owned. The 46 percent decline was the steepest among Midtown’s top 10 landlords, who control 93 million square feet, or about 41 percent of the market. Landlord and tenant leasing broker Cynthia Wasserberger, a managing director at commercial firm Jones Lang LaSalle said the landlords cut prices to attract tenants and keep their buildings filled. “I think all the landlords got aggressive. They were pretty swift in their decision to respond to the market,” Wasserberger said. [more]

From the February issue: The high volume of leasing in recent months, fueled in part by tenants signing early renewals at sharply reduced prices, could come back to bite the market next year, some industry experts said. Tenants with two and three years remaining on their leases — and sometimes even four years — are signing renewals early, said Bruce Mosler, CEO and co-chairman of commercial services firm Cushman & Wakefield. “We are seeing, I think, a push to market … to take advantage of the capitulations in rents,” he said. “Which I think is creating demand in this market, and I think it will [reduce] demand in ’11 … unless we see some job growth again.” However, some brokers did not expect the same elevated levels this year. “I don’t think January will continue at the same level,” Howard Rosen, regional managing director at commercial firm Grubb & Ellis New York, said in an interview. “As far as I am concerned, the jury is out, and I don’t see job creation in Manhattan.” [more]

From the January issue: They are not easily recognizable, but they are out there all around us, on the streets of Midtown and Lower Manhattan.
They are a growing breed of office towers, not quite alive but not
entirely dead either. They are New York’s City’s zombie buildings. And
within the commercial real estate world, once a building is tagged as a
problem site, it has a difficult time shaking off the negative label,
attracting tenants and finding rental income to nurse itself back to
health.
“It is a super-slow-motion thing that is occurring,” said Glenn
Markman, a commercial broker for Cushman & Wakefield, explaining
the vicious cycle that many Manhattan buildings have gotten stuck in
since the start of the downturn. more

335 Madison Avenue and Edward Goldman, an executive vice president with CBRE

Fighting back after losing millions of square feet in leasing agency assignments in recent months, commercial services firm CB Richard Ellis picked up the assignment for the 1.1 million-square-foot 335 Madison Avenue, Edward Goldman, a company executive vice president, told The Real Deal. The news comes two months after CBRE picked up the assignment for the 430,000-square-foot 101 Sixth Avenue in Hudson Square, but after losing the Empire State Building, 100 Church Street and others. The new assignment is welcome news for the brokerage. Because of losses such as 100 Church Street, CBRE is agent for nearly 7 million fewer square feet in Manhattan since September. As of this week, it was leasing agent for buildings, covering 55.5 million square feet, down from 62.2 million square feet three months ago, according to data from research firm CoStar Group. CBRE signed on earlier this month as leasing agent for the Milstein Properties Midtown building at Madison Avenue between 43rd and 44th streets, Goldman said. Before taking over, leasing had been handled by the Milstein in-house firm MB Real Estate. [more]