[IMGCAP(2)]West LB had eight years of a remaining term at below market rent. The surrender included a buyout fee paid to the landlord. RSM McGladry expanded into the space surrendered by West LB.
Additionally, RSM extended its existing lease term within 1185 Avenue of the Americas by three years and eliminated an existing right to cancel in 2011 resulting in a total commitment of 164,771 sf. The building, located at 1185 Avenue of the Americas, is a 42-story, 1.1-million-sf, class-A tower located between 46th and 47th streets. Steven Durels, EVP and director of leasing and real property for SL Green, tells GlobeSt.com that asking rents at 1185 Avenue of the Americas is $95 per sf, but he was not able to provide taking rents or aggregate lease values.
[IMGCAP(3)]Simultaneously RSM surrendered an existing lease covering 52,418 sf at 750 Third Ave., which had approximately five years of remaining term at below market rent.
Regent Business Centers signed a new 10-year lease covering the 52,418 sf surrendered by RSM McGladry at 750 Third Ave. The building is an 800,000-sf, class-A tower located three blocks from Grand Central Terminal. Durels tells GlobeSt.com that asking rents at 750 Third Ave. are $70 per sf, but he was not able to provide taking rents or aggregate lease values.
Durels tells GlobeSt.com that it was very time consuming and difficult to line up all three deals so that each was executed simultaneously. "It was a house of cards that needed to be tended to carefully."
He continues that "this series of transactions required delicate balance in negotiating the priorities and schedules of various unrelated parties. The result unlocked significant rental value and mitigates future lease expiration exposure."
Durels explains to GlobeSt.com that the incentive for the landlord was an increase in rent on all space. "Each of the leases we terminated were substantially below market, so this provided the opportunity to raise all rents up to market years in advance of the scheduled lease expirations."
RSM McGladry was represented by John Isaacs and Kevin Powderly of CBRE. Regent Business Centers and West LB were represented by Scott Klau of Newmark Knight Frank. The landlord was represented in-house by Howard Tenenbaum, Gary Rosen, and David Kaufman.
Continue Reading for Free
Register and gain access to:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
