As demand for distressed U.S. commercial assets crescendos, UBS is shopping a pool of failing commercial mortgages with a face value of $1.5 billion, Bloomberg News reported. Bids for the portfolio are due Wednesday. [more]

Office buildings in Manhattan

The financial services industry, the motor behind much of New York City’s economy, has been quietly exiting space, which bodes extremely poorly for the city’s real estate market, the Wall Street Journal said.

The city could lose approximately 10,000 securities jobs by the end of the year, according to statistics from the New York state comptroller cited by the Journal. One in eight jobs in the city relies on securities firms, the comptroller’s data indicate. [more]

When Larry Silverstein was asked to lend some of his time to be the featured guest at a B’nai B’rith real estate luncheon event held yesterday he was happy to oblige, and even agreed to pay for lunch, he told an audience of about 70 at the event in 7 World Trade Center. The developer said the organization has done extraordinary work in its more than 100 years of existence.

The animated, charasmatic and joyful impressario of Silverstein Properties stood behind a sleekly designed transparent lecturn, near 12-foot windows overlooking the development site, and talked for nearly 40 minutes about what he’s called his most important project –the redevelopment of the World Trade Center site.

He imparted two themes of New York development he’s learned in his 55-year career: Don’t bet against New York — it always comes back and strongly, and, referring to the built-on-spec 7 WTC, if you build it they will come. – Marc Becker
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When Swiss lender UBS AG called off negotiations to lease space at the World Trade Center as a result of disappointing second-quarter income earlier this month, it was reported the company was looking in other areas of the city. Now, the Wall Street Journal has reported that UBS is instead maintaining its flagship trading floor and other operations across Connecticut after the state agreed to provide the Swiss bank with a $20 million loan over a five-year period.
Gov. Dannel Malloy said that the bank must maintain 2,000 jobs in Connecticut and spend the so-called forgivable loan over that period for infrastructure expenses to be eligible for the incentive. UBS’ prospective move to New York would have cost the state $70 million in annual income, he said. [more]

Joint owners JPMorgan Asset Management and AXA Equitable Life Insurance have secured $372 million in refinancing for 1285 Sixth Avenue at Rockefeller Center, HFF, which arranged the refinancing, announced yesterday. The 10-year fixed-rate loan on the 1.65 million-square-foot, 42-story Midtown tower is with MetLife Real Estate Investments, HFF said.

Whitney Wilcox and Mike Tepedino, senior managing directors at HFF, represented the borrower.

Developed in 1960 as the Equitable Life Assurance Society of the United States headquarters, the building is currently 99.9 percent leased, HFF said. Anchor tenants include UBS, law firm Paul Weiss, Rifkind, Wharton & Garrison and advertising agency BBDO. – Katherine Clarke [more]

Switzerland’s largest lender, UBS AG, is in talks to move its Stamford, Conn.-based U.S. investment bank to Larry Silverstein’s planned 3 World Trade Center tower by 2015. A source told Bloomberg News that the bank, which currently has New York City offices at 299 Park Avenue and 1285 Sixth Avenue, would take around 800,000 square feet at the 71-story, 2.1 million-square-foot skyscraper, which will have an alternate address of 175 Greenwich Street and is one of four that Silverstein is planning for the site. UBS completed the move to its Stamford facility, which houses the world’s largest trading floor, in 2002. Comments

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Deutsche Bank, UBS and JPMorgan Chase are preparing the year’s first bond sales tied to commercial property loans, sources told Bloomberg News. Deutsche Bank and UBS are partnering to issue as much as $2.5 billion in commercial mortgage-backed securities linked to loans on office buildings, shopping malls and hotels in what would be the largest offering of its kind since the market froze in June 2008. JPMorgan plans to sell $1.5 billion in similar debt. Comments

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If misery loves company, embattled investment bank Goldman Sachs should be feeling better with each passing day. Yesterday, it was revealed that U.S. prosecutors are investigating Morgan Stanley over whether the bank misled investors in mortgage-derivatives deals it was simultaneously betting against. Today, sources told the New York Times that New York Attorney General Andrew Cuomo has launched a probe into whether eight banks duped rating agencies into inflating the grades of mortgage securities in the years before the housing market’s collapse. UBS, Citigroup, Credit Suisse, Deutsche Bank, Crédit Agricole and Merrill Lynch are targets of the probe, in addition to Goldman Sachs and Morgan Stanley.  [more]

Swiss bank UBS is said to be on the hunt for some 800,000 square feet of New York-area office space, making it the largest tenant in the market, Bloomberg reported. UBS already has roughly 5 million square feet in the tri-state area, including offices at 299 Park Avenue and 1285 Avenue of the Americas, Lincoln Harbor in Weehawken, N.J. and a trading complex in Stamford, Conn. Some of the bank’s existing leases are expiring in 2013, though it is unclear which ones, and as such, the bank is beginning to search for offices in new and existing buildings in Manhattan and its outlying areas, according to Kris Kagel, a UBS spokesperson. Sources said UBS had already requested proposals from landlords, but Kagel said a decision likely wouldn’t come for several months. “It would definitely be a boon to the landlord that lands them,” said Robert Sammons, research director for Colliers ABR. “Manhattan rents are at or near their low point. It remains an ideal market for the tenant.” [Bloomberg]

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From the December issue: If the last 12 months have served as a humbling recalibration of the entire U.S. economy, then there is perhaps no urban office district more representative of America’s fall from opulence than the commercial stretch along Park Avenue in Midtown. For decades, it was the province of the financial titans, including JPMorgan, Lehman Brothers and UBS, whose paychecks and egos were matched, in part, by Park Avenue’s astronomical asking rents in its premier buildings. But now, much like its former white-gloved denizens, Park Avenue is an empty shell of its former self. The Park Avenue submarket — which runs from Grand Central to 59th Street — has fallen harder and faster than any other Manhattan submarket over the past 12 months. According to Cushman & Wakefield, from October 2008 to October 2009, average asking rents dropped 34.7 percent, from $108.57 per square foot to $70.85 per square foot. By comparison, overall asking rents in Manhattan fell 22 percent during the same period. [more]