One of the largest commercial tenants at Trump Tower signed a lease for a large new office on Sixth Avenue.
The Industrial and Commercial Bank of China – the third-largest tenant at President Trump’s flagship property – signed a lease for just shy of 100,000 square feet at SL Green Realty’s 1185 Sixth Avenue, sources told The Real Deal.
Representatives for the Trump Organization and SL Green declined to comment. A spokesperson for ICBC, the largest of the “Big Four” Chinese banks and the biggest bank in the world with $4 trillion in assets, did not respond to requests.
Financial terms of the deal were not available, but a recent lease in the builing came with an asking rent of $75 per square foot.
ICBC’s new lease does not explicitly mean the bank will be vacating Trump Tower, though it’s likely the lender will relocate considering the size of its new deal and the fact that its lease at 725 Fifth Avenueexpires in November next year.
Also complicating matters is the fact that Trump could face a potential conflict of interest in negotiations with the bank, which is owned by the Chinese government.
A section of the U.S. constitution known as the emoluments clause prevents U.S. officials from receiving gifts from foreign governments. If the bank were to negotiate terms in a new lease that were deemed to be exceptionally favorable to the Trump Org., it could be considered a violation of the clause. In the most extreme case, it could lead to impeachment.
ICBC was paying rent at Trump Tower of $95.48 per square foot as of September 2012, Bloomberg News previously reported.
The bank is the third-largest tenant in Trump Tower with 25,356 square feet, according to information from Trepp on the property’s securitized loan. Gucci is the biggest tenant with almost 49,000 square feet, followed by the Trump Corporation at a little more than 42,500 square feet.
The bank signed a 10-year lease in the building in 2008, its first office in New York City. The company later expanded its Manhattan footprint in 2010 when it signed a lease for 10,000 square feet at Paramount Group’s 1633 Broadway. It’s since grown in the building to about 30,000 square feet.
ICBC focuses mostly on infrastructure and telecom businesses on mainland China. And while it also lends on commercial real estate, it has a small exposure here in the city.
The institution failed to make the list of the top 16 CRE lenders in 2017, according to TRD’s most recent ranking.
The bank in July lent Brookfield Property Partners $89 million for its Greenpoint Landing project in Brooklyn. And in August it provided $43 million for Pi Capital Partners’ 100,000-square-foot Flushing office building at 136-18 39th Avenue.
The bank participated in the $1.5 billion loan Related Companies and Oxford Properties Group landed in 2015 to finance construction of the 1 million-square-foot Shops and Restaurants retail portion of Hudson Yards.
ICBC’s net income for the first half of the year was up 4.9 percent – its biggest rise in more than three years – as the Chinese clamp down on interbank borrowing has squeezed smaller lenders to the benefit of the country’s biggest banks, the Wall Street Journal reported.