Nightingale Properties and the Friedland Properties bought an $76 million operating lease for a prime corner property on Madison Avenue, eyeing a quick upside from the building’s retail portion.
The joint-venture partners closed Monday on a long-term lease at 645 Madison Avenue, a 157,000-square-foot office building at the corner of 60th Street. While the office portion of the building, which reportedly has asking rents north of $100 per square foot, is full, the corner property has 36,000 square feet of vacant retail space.
TF Cornerstone had leased the building from a group of investors led by Richard Baker, chairman of Canadian retail giant Hudson’s Bay Company, whose family has owned the land underneath for decades.
Nightingale and Friedland plan to infuse capital into the building, said HFF managing director Rob Rizzi, who represented the joint venture along with colleagues Eric Anton, Andrew Scandalios, Richard Reid and David Fowler.
“Both parties worked incredibly quickly to get through diligence and consummate a landmark transaction,” Anton said.
Asking rents on Madison between 57th and 72nd streets are among the highest in the city at an average of $1,700 per square foot, according to the Real Estate Board of New York’s most recent report. Deals for some spaces, though, are going for north of $2,000 per square foot.
This is the first deal in Manhattan for Midtown-based Nightingale, which partners Elie Schwartz and Simon Singer founded in 2005. Nightingale teamed up with Infinity Real Estate last year to buy a pair of mixed-use properties in Brooklyn’s Midwood neighborhood for $79.1 million.
Dynastic family firm Friedland is one of Madison Avenue’s largest retail landlords. The company has recently turned to residential development with projects like a planned 17-story apartment building in the Flatiron District.
Correction: A previous version of this story incorrectly stated the price. It is $76 million.