The Real Deal New York

Town Residential’s real estate predicament: Few agents but four offices

Competing brokerages could snap up locations
By Rich Bockmann and E.B. Solomont | April 24, 2018 08:00AM

Andrew Heiberger and Town’s Astor Place office

At least three of Town Residential’s Manhattan offices are potentially in play as the gravely wounded brokerage shutters its resale and leasing operations.

Offices at 26 Astor Place, 33 Irving Place and 110 Fifth Avenue – Town’s flagship Flatiron District location – could all be snapped up by rival brokerages picking through the remains of what was once one of the city’s top brokerages, sources told The Real Deal.

Town already invested significant money in building out the spaces, and the offices are designed specifically for agents.

Corcoran Group CEO Pamela Liebman confirmed that the brokerage is looking at taking over Town’s leases.

“We are always open to looking at opportunities when they present themselves. [Town CEO Andrew Heiberger] and I are friends and we enjoy an ongoing dialogue. If there were bricks and mortar locations that made sense, we would certainly explore the possibilities.”

A spokesperson for Town could not be reached for comment.

The brokerage on Thursday informed agents it would close its resale and leasing operations following months of rumors and speculation that the company was facing financial difficulties, as TRD first reported. In a LinkedIn post on Saturday, Heiberger attributed the closures to high commissions costs and agent recruiting by rival firms.

After word got out that Town was shuttering multiple divisions, rival brokerages began reaching out to the top displaced brokers, and it appears the same thing is happening with Town’s real estate.

Heiberger said Town will continue to operate its new-development division out of offices at Vornado Realty Trust’s 888 Seventh Avenue, where the company signed a lease for more than 15,000 square feet last summer.

Town’s largest office appears to be the Flatiron flagship at 110 Fifth Avenue, which spans 16,600 square feet. The property’s owner, Rego Park-based Samson Management, did not respond to a request for comment.

The brokerage recently dealt with two lawsuits over unpaid rent.

Town’s landlord at 33 Irving Place – Virginia-based Belvedere Management – filed a lawsuit earlier last week claiming the company owed nearly $175,000 in back rent dating to January, plus other fees.

The lease had what’s known as a “good guy guaranty,” meaning Town could hand back the keys to the landlord and would only be on the hook for back rent covering the time the company occupied the space, instead of the remainder of the lease.

The co-op board that manages Town’s former Upper East Side office at 239 East 79th Street also filed a lawsuit claiming roughly $120,000 in unpaid rent. The suit was settled within a day.

In the outer boroughs, Town expanded by opening offices in WeWork locations in Astoria, Williamsburg and Brooklyn Heights. But a source familiar told TRD that the final outpost in Williamsburg at 240 Bedford Avenue closed a few months ago.