Brookfield, The Swig Co. Take Control Of Longtime HBO HQ, Plan Major Renovation
The 386K SF Midtown office building faces Bryant Park and sits on the corner of 42nd Street. It was developed in 1980 by William H. Nickerson, the chairman of Eugene A. Hoffman Management Inc., after he decided to vacate what his family had built decades earlier and turn it into modern, glass office space. In 1981, Time Inc. signed a 20-year net lease for all 350K SF of the building's office space for its HBO division at an estimated $175M.
Brookfield and Swig plan to redevelop the building in 2019 once Time Warner, which owns HBO, moves the television brand to its consolidated, 1.5M SF office being developed at 30 Hudson Yards. HBO has resided in the building for 35 years — its initial lease expired in 2004, but it was renewed.
"Our family has owned the land for over 150 years and will continue to own the land throughout the term of the lease," Nickerson said. "We are confident that working with Brookfield and Swig will be the best way to maximize our advantages of our outstanding location."
The land where the building stands was first acquired by Nickerson's great-great-great-grandfather, Garrit Storm, in the 1830s. The lower six floors of the building were built in 1906; nine floors were added in 1926. The building was reconstructed to add 25% more space in 1980.
Close to his death, it appears Storm wrote a letter to his daughter, Glorvina, and subsequent heirs. His advice was to hold onto the family real estate. He specifically suggested his land at 42nd Street and Sixth Avenue be used for "gardens and stables."
"My daughters and their husbands will see, if no misfortune happens to me, that they will be possessed of a revenue so considerable as to render it unnecessary to dispose of any of the real estate," Storm wrote. "This part of my property has taken up the greatest part of my life to accumulate. My investments have been generally fortunate."
Nickerson, a one-time Connecticut state senator, controls the company that bears the name of Storm's grandson, Eugene Augustus Hoffman. Hoffman was dean of the General Theological Seminary in New York in the late 19th century. Nickerson's brother, Adams Hoffman Nickerson, who had been president of Eugene A. Hoffman Management, died in 2004.
Nickerson put the building on the market with CBRE brokers Darcy Stacom and Bill Shanahan in May 2016, and, in compliance with Storm's wishes by leasing instead of selling, said they were willing to forgo a large, lump sum payment at the beginning of the deal with any partners to earn more money down the line for future generations.
New York-based Swig, Weiler & Arnow developed the famous, curved Grace Building next door, at 1144 Sixth Ave., in 1971 and sought to provide access and improvements to the plaza behind the building, but had been previously unsuccessful. The Swig family started the separate San Francisco-based The Swig Co., which owns five properties in NYC and is run by Cushman & Wakefield alumnus CEO Ken Perry.
Storm closed his letter, dated March 1, 1847, offering his descendants this to remember him by: "I must now close, and in finishing have to remark: I never gambled, never present at a cock fight, or bet on a horse race. Adieu, my children: your father bids you an affectionate farewell."