Franklin Templeton Taking 347K SF At SL Green's Midtown South Skyscraper
Investment management firm Franklin Templeton has signed a lease for a whopping 347K SF lease at SL Green’s One Madison skyscraper.
Franklin Templeton will take over the 11th through 22nd floors of the 50-story office tower for 15 years, SL Green announced Thursday. The deal brings One Madison, which is due to deliver in November 2023, to 55% leased according to a release.
Franklin Templeton plans to move into its space at One Madison once the building completes construction in November next year. Asking rents were $145 per SF, a spokesperson for SL Green told Bisnow — nearly twice the Manhattan average of $77.67 per SF in the second quarter, according to CBRE.
“We’re excited to welcome Franklin Templeton to One Madison Avenue,” SL Green Chairman and CEO Marc Holliday said in a statement. “This lease and the earlier IBM transaction are the second and third largest new leases signed in Manhattan in 2022 and are validation as to the exceptional quality of the building design.”
Cushman & Wakefield’s Rob Lowe, Jeff Cushman, John Cushman, Peyton Horn and Paige Engeldrum handled the deal for Franklin Templeton, while JLL’s Paul Glickman, Alex Chudnoff, Diana Biasotti and Ben Bass represented SL Green.
This lease is the second major lease to be signed at One Madison within the past six months. In March, IBM signed a 328K SF lease for 16 years, covering floors eight through 10 in addition to parts of the second and seventh floors. Chelsea Piers Fitness became the building’s first tenant last October, signing a 56K SF lease as the building’s flagship retail tenant.
SL Green is hopeful that One Madison will attract tenants back to Midtown South’s office market. Its blueprint for luring tenants back to Midtown — where an aging building stock and employers offering hybrid work have worked against office owners — is One Vanderbilt, which is 99% leased.
The REIT is Manhattan’s largest office landlord and scored a $1.25B construction loan for One Madison from joint venture partners Hines and the National Pension Service of Korea in November 2020.
But despite the Class-A office spaces within its portfolio, SL Green is still facing fiscal hurdles, Crain’s New York Business reported earlier this week. Its share price fell to $39.27 on Monday, the lowest it had been since May 2020.
Office owners of all stripes in NYC are bracing themselves as unpredictability over leasing demand continues, with demand for space overall cratering last month even as demand for Class-A space held steady according to VTS data.
Opportunistic investors, meanwhile, are waiting on the sidelines for signs of distress from aging office tower owners. Some of the first actors are already scooping up properties: Namdar Realty Group, which built its fortune acquiring distressed shopping malls, has snapped up two distressed Manhattan office towers within the last year.
UPDATE, SEPT. 29, 1 P.M. ET: This story has been updated to include the names of additional Cushman & Wakefield representatives working on behalf of the tenant.
