Basements are the new ground floors

As retail rents go up, developers are looking down

New York /
Sep.September 10, 2015 02:25 PM

“Lower-level spaces,” better know as basements, are the latest formerly-marginal segment to heat up in the booming retail property market.

As rents for retail spaces have risen, underground spaces in office buildings such as 1633 Broadway in Midtown and 28 Liberty Street in the Financial District are attracting investments from major developers.

“All the sophisticated landlords have begun to realize that if they can use their lower level, they can unlock tremendous value,” Brad Mendelson, a retail broker at Cushman & Wakefield, told Crain’s.

Mendelson, who is assisting the Paramount Group with their 40,000 square feet basement lease of 1633 Broadway, said that prime “lower-level” retail space in Manhattan usually rents for between $75 and $125 per square foot

Downtown, at 28 Liberty Street, China-based Fosun Property Holdings is undertaking a $200 million renovation of the building’s five basement floors. [Crain’s]Ariel Stulberg


Related Articles

arrow_forward_ios
Boston Properties’ Owen Thomas, Vornado Realty Trust’s Steve Roth, Paramount Group’s Albert Behler, SL Green’s Marc Holliday and Empire Real Estate Trust’s Tony Malkin  (iStock, slgreen.com, vno.com, paramount-group.com, esrtreit.com, LinkedIn)
Office landlords profess optimism despite dip in occupancy
Office landlords profess optimism despite dip in occupancy
1301 Sixth Avenue and Paramount Group's Albert Behler (Google Maps, Getty)
Wells, Morgan Stanley to provide Paramount’s $860M refi at 1301 Sixth Avenue
Wells, Morgan Stanley to provide Paramount’s $860M refi at 1301 Sixth Avenue
Photo Illustration of Paramount Group Chairman, CEO and President Albert Behler in a Manhattan Equinox (Paramount, Equinox, Getty)
Despite rent-deferral agreement, landlord claims Equinox still won’t pay
Despite rent-deferral agreement, landlord claims Equinox still won’t pay
Paramount Group lost $16 million last quarter
Paramount Group posts $16M quarterly loss
Paramount Group posts $16M quarterly loss
Paramount CEO Albert Behler and 60 Wall Street (Getty, Paramount Group)
Paramount Group plans $250M facelift for 60 Wall
Paramount Group plans $250M facelift for 60 Wall
Paramount Group CEO Albert Behler and 1301 Avenue of the Americas. (Paramount)
Paramount Group preps for $850M refinance
Paramount Group preps for $850M refinance
1301 6th Avenue, Paramount CEO Albert Behler and 31 West 52nd Street (Getty; Hines/Photo Illustration by Kevin Rebong for The Real Deal)
Paramount Group revenue declined $30M in 2020
Paramount Group revenue declined $30M in 2020
A long road ahead for office landlords
A long road ahead for office landlords
A long road ahead for office landlords
arrow_forward_ios

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

Loading...