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Optimistic Long-Term, Not Short-Term

NEW YORK CITY-Sherwood Equities' Katz and Nelson would be making more acquisitions throughout Manhattan if the opportunities were there

By Paul Bubny | Updated on October 09, 2009

NEW YORK CITY-Since acquiring 370 Lexington Ave. a year ago in a $155-million deal with financial partner JPMorgan Chase, Sherwood Equities has focused on positioning the 307,000-square-foot office tower as a magnet for tenants of 10,000 square feet or less. The strategy has been successful: Sherwood, led by CEO Jeffrey Katz, has closed 13 new deals and handled seven tenant renewals and one expansion at 370 Lexington over the past year. The most recent of the new leases, a 3,562-square-foot deal by newly formed Boxwood Strategic Advisors, was announced last week.

It’s also an example of Katz’s knack for thinking ahead. Many of the newly signed tenants at 370 Lexington have been start-ups launched by Wall Street veterans who were displaced by the financial-sector upheaval that erupted around the time Sherwood and JPMorgan bought the property. Katz was among the first to see the commercial office potential in Times Square, and began acquiring development sites on the Far West Side years before the Hudson Yards mega-project was proposed. Sherwood’s investment strategy during the peak of the market was low-key by comparison to some of the more acquisitive—and highly leveraged—players, and that has stood the company in good stead amid the downturn.

GlobeSt.com sat down recently with Katz and Ryan Nelson, Sherwood’s SVP for development, to discuss the market from the vantage point of a well-capitalized company that would be making more acquisitions if the opportunities were there. In the long term, their confidence in New York’s eventual resurgence is unshaken; short term, they’re drumming their fingers.

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