Morgan Stanley takes nearly 150K square feet at Vornado’s 1290 Ave. of the Americas

Deal is the largest sublease of 2013

New York /
May.May 23, 2013 02:30 PM

UPDATED, 5:37 p.m., May 23: In what is the largest sublease of the year so far, Morgan Stanley has inked a 148,421-square-foot deal at Vornado Realty Trust’s 1290 Avenue of the Americas, according to data from commercial real estate firm Cassidy Turley provided to The Real Deal.

The nation’s sixth-largest bank by assets subleased the entire 12th and 13th floors from life insurance company AXA Equitable, which has 443,599 square feet in the 44-story, 2 million-square-foot Midtown office tower, located between 51st and 52nd streets, according to CoStar Group. The length of the term is 11 years.

A Jones Lang LaSalle team led by Matthew Astrachan, Mitti Liebersohn and Paul Glickman brokered the deal. Morgan Stanley has been reportedly eyeing the space since at least the beginning of May, and an unidentified executive told the New York Post at the time that rents would be in the $40s per square foot. Representatives from Morgan Stanley, JLL and AXA did not immediately respond to requests for comment.

The deal is comfortably the year’s largest sublease transaction. Another AXA sublease deal at the building, in which Sirius Satellite took 86, 877 square feet on the entire 11th floor, was the second largest, the Cassidy Turley data show. French alcohol manufacturer Remy Cointreau also took 52,811 square feet from AXA on the 14th floor of the building.

Law firm Ropes & Gray — which has seven floors at Beacon Capital Partners’ 1211 Avenue of the Americas totaling over 277,000 square feet  — subleased the 40th floor to law firm Zeichner Ellman & Krause, the data show.

The 10-year deal covered a 42,435-square-foot space and, according to data provider CompStak, rents for the sublease were in the low $50s per square foot, while Ropes’ current rent for the space is in the $60s.

“Sublease space continues to be in high demand in today’s value-driven market,” said Richard Persichetti, Cassidy Turley’s vice president of research, marketing and consulting , explaining that sublease tenants enjoy, on average, a 10 to 15 percent pricing discount compared to direct leases.

In April 2012, Morgan Stanley signed a nearly 1.2-million-square-foot renewal and expansion lease at Brookfield Office Properties’ 1 New York Plaza in Lower Manhattan that will keep them in the building through 2029.


Related Articles

arrow_forward_ios
Vornado's Steve Roth and 220 Central Park South (Credit: Getty Images, iStock)
Free and clear: Vornado pays off debt at 220 CPS
Free and clear: Vornado pays off debt at 220 CPS
Vornado chairman and CEO Steven Roth, and 608 Fifth Avenue (Credit: Getty Images)
“Negative surprises”: Vornado execs talk retail struggles on Q2 earnings call
“Negative surprises”: Vornado execs talk retail struggles on Q2 earnings call
Steven Roth, CEO of Vornado and 640 Fifth Avenue (Credit: Getty Images and Vornado Realty Trust)
Bank of China issues $500M to Vornado in refi of 640 Fifth Avenue
Bank of China issues $500M to Vornado in refi of 640 Fifth Avenue
Vornado ceo Steven Roth and One Penn Plaza (Illustration by Kevin Cifuentes for The Real Deal with Getty Images, Vornado Realty Trust)
Vornado’s Roth sees “choppy” market, chides Penn skeptics
Vornado’s Roth sees “choppy” market, chides Penn skeptics
Edmonton Oilers' Daryl Katz with 220 Central Park South
Oilers owner buys $36M pad at Vornado’s 220 CPS
Oilers owner buys $36M pad at Vornado’s 220 CPS
Vornado’s Steven Roth and Governor Kathy Hochul with Penn 15 and Penn Station (Getty, DBOX, MTA)
Penn Station vote clears way for deals with developers
Penn Station vote clears way for deals with developers
City Planning Commissioner Hope Knight and a rendering of the new Penn Station (NYC Department of City Planning, Getty Images)
State greenlights massive Penn Station development plan
State greenlights massive Penn Station development plan
Vornado's Steve Roth, NY State governor Kathy Hochul and Moynihan Train Hall (Getty Images, iStock, Moynihan Train Hall)
Vornado in line for $1.2B tax break at Penn: report
Vornado in line for $1.2B tax break at Penn: report
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...