The Real Deal New York

Blackstone co-founder’s family wealth firm moving to Park Avenue

Peterson Management inks deal for 40K sf at Boston Properties’ 399 Park
By Rich Bockmann | November 03, 2017 02:02PM

Peter Peterson and 399 Park Avenue

The investment firm that manages the family wealth of former Lehman Brothers CEO and Blackstone Group co-founder Peter Peterson is moving its offices to A Pricy Space On Park Avenue.

Peterson Management, headed by Peter’s son, Michael, signed a lease for 40,000 square feet on the 14th floor at Boston Properties399 Park Avenue, sources told The Real Deal. The space includes part of a glass box the landlord built on the rooftop of the building’s setbacks and includes outdoor terraces. The rent starts at $130 per square foot and escalates to $150 per square foot toward the end of the 15-year term, according to a source with knowledge of the deal.

Representatives for Boston Properties and Peterson couldn’t be immediately reached for comment.

Seth Hecht at Cushman & Wakefield represented Peterson along with Joseph Conwell of the Philadelphia-based GPX Realty Partners.

Along with the Peterson Foundation, the nonprofit that Peter Peterson launched in 2008 to focus on fiscal policy issues, the management shop will be relocating from Paramount Group’s 712 Fifth Avenue, where it occupies more than 26,000 square feet on a handful of leases expiring next March.

Peterson served as the US Secretary of Commerce under President Richard Nixon from 1972 to 1973. After leaving he went to be CEO of Lehman Brothers, where served until 1985 when he co-founded the Blackstone Group with Stephen Schwarzman.

He made most of his fortune when Blackstone went public in 2007 and he sold a large portion of his stake for $1.85 billion, according to Forbes, which placed his net worth at $2.1 billion. That makes him the 973rd richest person in the world.

Boston Properties in 2016 kicked off a capital-improvement project at the 1.7 million-square-foot tower, formerly known as the Citigroup Building, with an eye toward filling a block of roughly 350,000 square feet left behind after Citigroup made plans to relocate its headquarters to the Lower Manhattan complex at 388 and 390 Greenwich Street.

It’s one of several large vacancies calling into question Park Avenue’s reputation as the “Boulevard of Business” and its popularity with large financial tenants, which are heading to places like Lower Manhattan and the Far West Side.

Major League Baseball is leaving behind some 220,000 square feet at HNA Group’s 245 Park Avenue when it relocates to the Rockefeller Group’s 1271 Sixth Avenue, the former Time-Life Building. And Blackrock Is Moving From Two Park Avenue buildings where it occupies 700,000 square feet to 50 Hudson Yards.

NorthStar Realty Finance is relocating from 399 Park to 590 Madison Avenue, where it will consolidate offices with Tom Barrack’s Colony Capital after the two merged. And Boston Properties will get back more than 60,000 square feet at its tower next year from the hedge fund Eton Park, which announced in March it was shutting down after a 13-year run amid headwinds facing the investment industry.