This Week's N.Y. Deal Sheet
After a blistering beginning of August for New York City office leases, there were no huge deals signed over the last few days, but the deals keep coming in just a few weeks before Labor Day, including a flagship Times Square retail lease.
The Brooklyn Nets' parent company has been in Manhattan ever since the team moved from the Meadowlands and embarked on a new era at the Barclays Center. But last week, Brooklyn Sports and Entertainment signed a 70K SF lease at Industry City in Brooklyn's Sunset Park, moving its corporate HQ one floor below its training center in the 16-building, 6M SF redevelopment. The complex, owned by Jamestown and Belvedere Capital, will welcome BSE in June. Cushman & Wakefield's Bruce Mosler and Joe Cirone repped BSE, which will retain a satellite office in Manhattan at 125 Park Ave., owned by SL Green.
WeWork is not eating up space in New York City this year at the quite the pace it did in 2016, but it is by no means stagnating. The co-working giant, fresh off a new round of investment at a $20B valuation, signed a lease to occupy four full floors at 115 Broadway, known as Two Trinity Centre. CBRE's Adam Foster, Brad Gerla, Adam Leshowitz and Mike Rizzo repped the two-building, historic complex's owner, Capital Properties. WeWork's lease covers 85K SF on the fourth through seventh floors. The 420K SF building has 21K SF floor plates, and asking rents are between $55 and $59/SF.
Champs Sports, now a subsidiary of Foot Locker, is bringing a flagship retail store to Times Square. The athletic retailer signed a multi-floor deal at 10 Times Square, the 550K SF building at 1441 Broadway owned by Lechar Realty Corp. Champs Sports, repped by Retail Strategies' Mark Finkelstein, is taking part of the 77-year-old building's 46K SF of retail space. JLL's team of Robert Gibson, Davie Berke, Amy Zhen and Steven Robinson repped the landlord.
DramaFever, a video streaming service, is moving to Park Avenue. The company is subleasing 23K SF from Return Path, an email tech company, at 3 Park Ave., the 41-story building owned by Cohen Brothers Realty. The three-year deal gives DramaFever the 30th floor of the nearly 1M SF Midtown tower. CBRE’s Jamie Dennison represented DramaFever, and Newmark Knight Frank's Ira Rovitz and Todd Hershman repped Return Path, which occupies the building's top floor and previously subleased the 30th floor to Grovo.
In the only nine-figure building sale to cross New York City property records last week, the Jemal family's JJ Operating company paid $107.3M for 278 Eighth Ave. in Chelsea, a two-story commercial property anchored by CVS Pharmacy and New York Sports Club, a branch of the struggling Town Sports International. The Jemal family bought the 40K SF property from Midboro Management.
Rockpoint Group and Highgate bought the Royalton Hotel in Midtown close to Grand Central Terminal for $55M. FelCor Lodging Trust, going through an embattled merger with RLJ Lodging Trust, sold the 168-room hotel, for which Deutsche Bank provided a $36.4M acquisition loan.
Our Lady of the Rosary LLC has acquired a 74-unit apartment building in the Hamilton Heights neighborhood of Manhattan. The 102K SF building at 676 Riverside Drive sold for $32M, or about $432K/unit. The apartments were sold by architect David Weiner, according to property records.
Sales data courtesy of Reonomy.
TOP FINANCING DEALS
The biggest commercial transaction last week undoubtedly came on the finance side, as the Durst Organization's subsidiary, Royal Realty Corp., refinanced 16 commercial properties. Citibank provided the $600M loan for the portfolio, most of which was in commercial condos at 205 East 42nd St., and three properties along neighboring Third Avenue. The $600M debt was part of a $1B loan package Durst secured, which included a $400M line of credit.
Yoel Goldman closed on a $240M financing package for his Rheingold Brewery site development in Brooklyn, at 123 Melrose St. The deal included three loans, one at $141M, one at $95M and one at $3.3M, and was provided by Madison Realty Capital. Bank of the Ozarks holds the note on the loan, perpetuating the perception around New York that it is one of the few banks still active in construction lending.
Queens developer Chris Xu secured a $100M loan from the Bank of China's New York branch for his enormous planned development along 44th Drive in Long Island City. The project was pitched as 79 stories of residential, so this is only the first piece of the financing puzzle Xu must assemble to build his 963-foot vision.
Financing data courtesy of Reonomy.