A large residential property manager is making a commercial move, leasing office space at Beacon Capital Partners’ 575 Fifth Avenue.
FirstService Residential took 48,000 square feet at the Midtown building across the ninth and 10th floors, Commercial Observer reported. The lease is for 15 years. The asking rent was not reported.
Montroy DeMarco Architecture is working on the buildout for the tenant. FirstService, which claims to be the largest residential property manager on the continent, expects to move into the space this fall, according to the Observer.
Mark Friedman of Colliers represented FirstService in the deal. Josh Kuriloff and Bruce Mosler of Cushman & Wakefield represented Beacon Capital, along with an in-house team.
Beacon and MetLife, which co-owns the building, recently renovated the 35-story, 500,000-square-foot property, adding a tenant lounge, bike parking and a Starbucks, according to the Observer. Tenants include Axpo, Charlesbank and Russell Investments.
In 2019, TPG Real Estate lent nearly $309 million to refinance an office condo unit at 575 Fifth Avenue leased to Barneys New York for its corporate headquarters and a large WeWork location. The money replaced a previous loan from Deutsche Bank.
The Midtown office submarket generated more positive news than the other major Manhattan submarkets last year. It had positive net absorption for the year and the most leasing activity in the fourth quarter, with deals signed for 22 percent more space than Midtown South and Downtown combined. The submarket also had a higher average asking rent than its rivals, though the figure fell by nearly 3 percent year-over-year.
Late last year, Brookfield Properties paid FirstService Residential $8.3 million to buy a 38,000-square-foot, fully leased office building at the Park at Broken Sound in Boca Raton. The property manager proceeded to rent the building under a short-term lease after the sale.
[CO] — Holden Walter-Warner