Here’s what tenants are paying at Brookfield & Swig’s Grace Building

Bank of America, the Trade Desk and Bain & Company among top tenants at 1.56M-sf tower

New York Insights /
Nov.November 20, 2020 02:52 PM
The Grace Building at 1114 Sixth Avenue (Photo via Wikipedia Commons)

The Grace Building at 1114 Sixth Avenue (Photo via Wikipedia Commons)

Developed by San Francisco-based Swig Company in 1974, the Grace Building, which overlooks Bryant Park, is easily recognizable by its sloping facades.

The 48-story office tower, located at 1114 Sixth Avenue, experienced significant turnover in its rent roll a few years ago when several of its largest tenants, including HBO and Silicon Valley law firm Cooley LLP, relocated to Hudson Yards. The vacant space was quickly filled by new tenants like Bank of America and digital marketing firm the Trade Desk.

Swig and Brookfield Property Partners — which bought into the property in 2006 when it acquired Trizec Properties in 2006 — have invested more than $160 million to renovate and lease the building since 2014. In 2017 the two firms jointly acquired the long-term leasehold on neighboring 1100 Sixth Avenue, where Bank of America replaced HBO as the sole office tenant.

This month, Bank of America and JPMorgan led a $1.3 billion refinancing of the property along with Credit Suisse and Deutsche Bank. Notes comprising the new debt are being contributed to several CMBS deals, and documents associated with these transactions provide an up-to-date look at the property’s finances.

The 1.56 million-square-foot property — split between 1.48 million square feet of office and 59,000 square feet of ground-floor retail — is now 95 percent leased with more than 35 tenants. Bank of America is the largest tenant by square footage, with 10 percent of total rentable space, but its annual rent bill is only the third-largest.

The Trade Desk, whose office includes the pricey three-floor penthouse, pays $131 per square foot in base rent, well above the building average of $95. “Big Three” management consultancy Bain & Company, which has been at the building since 2014, also pays triple-digit rent for its 120,000-square-foot space.

The two remaining tenants in the top five, Israel Discount Bank and venture capital firm Insight Partners, pay below-market rents for their spaces. The top tenants at the building all have remaining lease terms of at least 10 years, although the Trade Desk and Israel Discount Bank have early termination options.

Of the building’s five retail tenants, four have not made rent payments for the last few months, according to Moody’s, and rent deferral negotiations are in progress. The building’s parking tenant has defaulted on its lease after missing rent payments since March, and the landlords are in the process of bringing in a new parking operator.





    Related Articles

    arrow_forward_ios
    258 8th Avenue (Google, Target)

    Target planning yet another NYC store in Chelsea

    Target planning yet another NYC store in Chelsea
    Churchill Real Estate's Justin Ehrlich and 381 Broadway (Google Maps)

    Two-year Tribeca foreclosure saga continues with lawsuit over $20M

    Two-year Tribeca foreclosure saga continues with lawsuit over $20M
    Adam America's Omri Sachs and Dvir Cohen with 2503-2509 Broadway (Google Maps; Adam America)

    Adam America secures $63M in financing for Upper West Side project

    Adam America secures $63M in financing for Upper West Side project
    Convene CEO Ryan Simonetti (Convene)

    Convene closes Manhattan locations as corporate events fail to return

    Convene closes Manhattan locations as corporate events fail to return
    New York City District Council of Carpenters’s Monitor Glen McGorty (iStock; LinkedIn)

    NYC carpenters union changes how it roots out mob ties

    NYC carpenters union changes how it roots out mob ties
    The Economic Innovation Group identified 145 real estate investments in Opportunity Zones (iStock)

    Real estate deals dominate Opportunity Zones. Is that bad?

    Real estate deals dominate Opportunity Zones. Is that bad?
    11 Penn Plaza and Apple CEO Tim Cook (VNO; Getty)

    Apple snags more space at Vornado’s 11 Penn Plaza

    Apple snags more space at Vornado’s 11 Penn Plaza
    Amazon's Jeff Bezos, Google's Sundar Pichai and Facebook's Mark Zuckerberg (Getty, iStock)

    Tech giants occupy nearly 600M-sf of US real estate

    Tech giants occupy nearly 600M-sf of US real estate
    arrow_forward_ios

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

    Loading...