Arnold Fisher, senior brothers of Fisher Brothers, 1345 Sixth Avenue and the fountains outside the building

The Fisher Brothers is planning on adding an underground retail component to a trophy Sixth Avenue office property, the New York Observer reported, and has tapped Cushman & Wakefield to market the space. The landlord’s vision for 1345 Sixth Avenue mimics Harry Macklowe’s glass cube retail addition to the GM Building, which was leased by Apple and has become one of the city’s most lucrative retail locations. [more]

From the November issue:

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Compiled by Russell Steinberg… [more]

FAO Schwarz has ended speculation by finally renewing its lease at Boston Properties’ General Motors building, the New York Post reported. There had been rumors that the Toys “R” Us-owned toy retailer might leave when its lease ended in 2012. Agent Bradley Mendelson of Cushman & Wakefield confirmed the extension.

In March it was reported that Boston Properties and FAO Schwarz had entered arbitration over the rent. Shortly after purchasing the 1.77 million-square-foot building, Boston Properties said FAO Schwarz was not the most financially viable tenant considering the under-market rent it currently pays.

Sources said Mendelson’s team quietly talked to other prospective users if Schwarz decided not to renew. … [more]

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…. [more]

FAO Schwarz exercised its option to extend the lease on its iconic 767 Fifth Avenue location for “fair market value” just three years after preparing to leave, according to Bloomberg News. Boston Properties, which bought the GM Building for a record $2.8 billion in 2008, was so sure FAO Schwarz would vacate its three-flour, 66,465-square-foot retail space when the lease expired in 2012, that the property owner began marketing the property for a new tenant. Now the two parties have entered arbitration over the rent. Shortly after purchasing the 1.77 million-square-foot building, Boston Properties said FAO Schwarz was not the most financially viable tenant considering the under-market rent it currently pays. The stretch of Fifth Avenue between Rockefeller Center and Central Park is the world’s priciest retail real estate. But Toys “R” Us, which owns FAO Schwarz, doesn’t want to endure the difficulty of finding a different Fifth Avenue location and can’t relocate the store to Times Square for fear of competition with its own flagship store. [Bloomberg]

In a pair of sit-down interviews this week, William “Billy” Macklowe opened up — barely — about his split from his father, Harry’s, Macklowe Properties, what he learned from the collapse of the Macklowe empire and his just-launched venture, the William Macklowe Company.

He was tight-lipped with the Observer, refusing to talk even about cooking because, as he put it, “so much has been written about the past and all that, it’s just not an area that I really wish to comment on.” He contended, though, that he was “not tightly coiled at all,” as the reporter had observed.

In an interview with Bloomberg News, Macklowe was more relaxed. He told the publication: “one lesson we’re absolutely going to take away from this is no short-term financing,” when asked about Macklowe Properties’ debt woes and the decision to sell off trophies like the GM Building. He fought back against the notion of being the so-called “poster child” for the real estate bust, nominating other notorious failures like the General Growth Properties bankruptcy and Stuyvesant Town and Peter Cooper Village foreclosure for the title.

Still, his peers weren’t as kind. “Billy Macklowe is a guy who woke up on third base and thinks he hit a triple,” one anonymous broker told the Observer. Another said, “he was really mean to people when they were on the top of the world, and unfortunately that’s what people are remembering right now… but at the end of the day, he’s a really talented guy with a high aesthetic.”
[NYO] and [Bloomberg]

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Developer Sheldon Solow has buried the hatchet and dropped his lawsuit against insurance group Conseco over the $1.4 billion auction of the General Motors Building in 2003, according to Reuters. Solow had filed the complaint in August 2006, alleging that Conseco had rigged the auction in favor of rival developer Harry Macklowe, who ultimately bought the property. The voluntary dismissal in Manhattan federal court, which was handed down after Solow and Conseco’s joint filing, was made with prejudice, meaning that the same complaint can’t be filed again.

Joseph Moinian’s 1775 Broadway (building photo source: PropertyShark)

Granted that, as architecture goes, the former General Motors Building, at 1775 Broadway between Broadway and Eighth Avenue and 57th and 58th streets, is no beauty. In fact it is downright ugly — an overbearing and unimaginative study in pre-war red brick with a tasteless splash of mortar at street level. It took two firms to create this thing, with William Welles Bosworth contributing the pale granite base and Shreve & Lamb of Empire State Building fame finishing the brick-clad upper floors.
But whatever one thought of their collaboration, no building deserves the indignity to which this one is now being subjected at the hands of the Moinian Group, which has decided to change the building’s address to 3 Columbus Circle and reclad the building in a cheap-looking layer of bluish, reflecting glass that is acrobatically tactless in this context (not that it looks especially good anywhere else)…. [more]

Katz Media Group is taking over more than one-third of the office space at Boston Properties’ 125 West 55th Street under a lease renewal that extends until mid-2027, with an option to stay an additional five years after that. Katz, a division of radio company Clear Channel Communications, already occupies the third through seventh floors and will take over the 11th and 12th floors, plus some basement space, for roughly 200,000 square feet in total. Boston purchased the 591,000-square-foot building for $444 million from Macklowe Properties in 2008 in a deal that included the GM Building, 2 Grand Central Tower and 540 Madison Avenue. Asking rents were estimated in the $50s per square foot, sources told the Post. The Katz deal, along with leases with other tenants like Macquarie Holdings and Air France, helped Boston Properties get a new $207 million mortgage on the property through MetLife. [Post]

The new Apple store at 1981 Broadway

“Critical mass,” admittedly, is an overused term, unless you take a professional interest in particle physics, and I don’t. But I know it when I see it on the streets of New York, and I have just seen it on the Upper West Side. As anyone who has walked along Broadway from Columbus Circle to 72nd Street can attest, this stretch of Manhattan has been continually improving over the past 10 years. And as someone who grew up right around there, I can assure you that it is incalculably finer, safer and more fun than it ever was in the 1970s. But it wasn’t until, on a recent winter evening, that I passed the new Apple Store at 1981 Broadway on the northwest corner of 67th Street, that I understood what was afoot. The new Apple store succeeds in being even bolder and more inventive
than the cube in front of Edward Durrell Stone’s GM Building on Fifth
Avenue and 59th Street.  More

… [more]