Normandy's 575 Lex Tip-Toes Toward Lease-Up
This morning, Normandy Real Estate Partners, New York Life Real Estate Investors, and Prudential Real Estate Investors announced that Cornell University's Weill Medical College will expand by 35k SF to 182k SF for 15 years at 575 Lexington. We snapped the building, where Janney Montgomery Scott also expanded by 9,000 SF to 31k SF. Normandy leasing co-head Paul Teti says the company redid the entire capital stack, gave the common areas a facelift, put in new mechanical systems, and will relaunch it at the beginning of 2014. With these two leases, 214k SF of the 739k SF building is spoken for. JLL's Paul Glickman, Mitti Liebersohn, Steven Rotter, Diana Biasotti, and Brittany Wunsch repped Normandy. Cornell was repped by C&W's John Cefaly, Michael Burgio, and David Berke; John Adams Co's John Adams, and ITRA's Albert Duryea. CBRE's Ken Rapp repped JMS.
Paul (whom we snapped yesterday at lunch with YM/WREA, flanked by Cushman tri-state prez Ron Lo Russo and Boston Properties' Adam Frazier) says Normandy buys props that need significant debt, equity, or capital stack work, lease-up, or repositioning or cosmetic work, then sells. He says plenty of "miscapitalized properties" from the recession are still out there. (Find out where on the laziest episode of Unsolved Mysteries.) The landlords may know what to do but lack the capital to do it, he says. As for its other Manhattan office properties, Paul expected a 24- to 36-month lease-up for 1370 Broadway (recapped at acquisition and lobby repositioned) but he says it's in the 8th inning just 18 months after acquisition. And for 119 W 25th, which requires all of the above, plus a gut renovation, well, they're still singing the national anthem.
We also snapped NGKF's Billy Cohen (busy leasing up the Empire State Building), NAI Friedland president Scott Benson, and NGKF's Leslie Harwood. The three went to the University of Miami together and attended yesterday's lunch, and each has three children.