Adam Neumann-backed co-working firm raising $500M, REBNY says rent laws cost city $1B: Daily digest

A daily roundup of real estate news, deals and more for October 2, 2019

TRD New York /
Oct.October 02, 2019 05:20 PM

Every day, The Real Deal rounds up New York’s biggest real estate news. We update this page in real time, starting at 9 a.m. Please send any tips or deals to [email protected]

This page was last updated at 5:20 p.m.


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A co-working firm backed personally by Adam Neumann is raising $500 million. Selina, which provides office space to travelers, is seeking to launch a fund to invest into U.S. properties. [Bloomberg]

 

REBNY claims rent laws could cost city $1 billion in lost tax revenues. Jim Whelan, the real estate industry group’s new president, said industry data pointed to a steep drop in multifamily-building sales in the first month after the controversial laws passed. [Crain’s

 

Avi Dorfman’s claim to be a Compass co-founder will be heard by a New York jury. He’s also seeking a $200 million stake in the company. [TRD]

 

Manhattan could become a little bit longer. The city’s Economic Development Corporation has commissioned a study to assess the possibility of extending the island into the East River with flood protections, as the effects of climate change impact the city. [Curbed]

 

Free rent for all! That’s the message tenant organizer Phara Souffrant has for constituents in her campaign to oust Brooklyn Assemblymember Walter Mosley. [TRD]

 

Meet A-Rod, the developer. After retiring from the Yankees in 2016, the all-star player now has his sights set on launching a massive real estate portfolio in New York and South Florida. He sat down with TRD for an exclusive interview. [TRD]

 

Fitch Ratings: WeWork’s bonds are junk. The ratings agency downgraded the company’s credit rating to “CCC+” on Tuesday, becoming the second ratings agency to downgrade WeWork’s rating to junk status. Standard & Poor downgraded the company to “B-” last week. The downgrade comes amid troubling uncertainty with the company surrounding its planned IPO that culminated with a decision Monday to call off the public offering. CEO Adam Neumann stepped down last week and the company is in the midst of an overhaul at the leadership level. [Reuters]

 

A car dealer owner is moving into 220 Central Park South. Michael Cantanucci has dropped $38.1 million for a 4,814-square-foot condo at the tower owned by Vornado Realty Trust. [TRD]

 

WeWork installs new head of Japan amid Asia shakeup. Kazuyuki Sasaki, the former managing director of WeWork Japan, is replacing Adam Neumann ally Chris Hill as CEO of Japan operations. The company is also considering halting its growth plans in China, which would fall into line with drastic cost-cutting measures meant to reduce mounting losses. [TRD, Bloomberg]

 

Justice Department’s broker commission inquiry widens. The agency acknowledged Monday that it sent a civil investigative demand to CoreLogic linked to a probe into residential real estate brokerages. Two class-action lawsuits allege that multiple brokerages are inflating seller costs. And a source told Law360 that the DOJ’s inquiry likely involves other firms. [Law360, Inman]

 
(Illustration by Chari Tsevis)

(Illustration by Chari Tsevis)

What Corcoran’s leaked files show. After what the brokerage called a major hack, documents have shed a light on the firm’s most treasured data. Among the findings: About a third of commissions were generated by just 37 of more than 1,000 agents. [TRD]

 

Tishman Speyer closes on lease at Morgan North Post Office. The landlord will take the top six floors at the 10-story building on Ninth Avenue in Hudson Yards. It reportedly plans to redevelop the space into a tech hub with a 2.5-acre roof deck. [NYP]

 

Despite recent protests, Equinox signed a huge lease in NoMad. The fitness and health club, owned by Stephen Ross’ Related Companies, agreed to take the bottom four floors at 31 West 27th Street, a 12-story building owned by Savana. It is a 20-year lease for 39,000 square feet. Calls for boycotts of Related businesses emerged when Ross hosted a fundraiser for President Trump. [Crain’s]

 

A notorious landlord will offload Bed-Stuy properties. Northeast Brooklyn Housing Development Corp., which owns more than 1,000 low-income units, will sell five buildings riddled with violations to another nonprofit, Mutual Housing Association of New York. Another six properties are to be sold to a for-profit developer, ELH Management. [The City]

 

Judge rules in favor of New York’s strip clubs and XXX bookstores. Decades after new regulations pushed seedy establishments out of Times Square, a judge has ruled they “are a throwback to a bygone era” that would destroy the sex shops that have managed to stay in their locations. [NYDN]

 

Newsmax is moving to a new studio at 805 Third Avenue. The conservative news outlet, which is based in Palm Beach, Florida, has signed a 24,000-square-foot lease on the 22nd floor of the Cohen Brothers–owned building. [NYP]

 
The Daily News Building at 220 East 42nd Street and SL Green CEO Marc Holliday (Credit: Getty Images)

The Daily News Building at 220 East 42nd Street and SL Green CEO Marc Holliday (Credit: Getty Images)

SL Green is selling the Daily News building. Jacob Chetrit went into contract to buy the 32-story building at 220 East 42nd Street for $815 million. It is expected to close in the first quarter of 2020. [TRD]

 

Compiled by David Jeans


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