NEW YORK CITY-Metro-North Commuter Railroad Co., a subsidiary of the Metropolitan Transportation Authority, has signed a 20-year lease for 265,903 square feet at 420 Lexington Avenue, also known as the Graybar Building, according to SL Green.
The lease covers a 133,503-square-foot renewal for the entire 11th, 12th and partial 22nd floors plus a 132,400-square foot expansion on the entire 10th floor and significant portions of the second, third and fifth floors. Adjacent to Grand Central Terminal, the 30-story building spans 1.2 million square feet.
Josh Kuriloff, executive vice chairman, directors Jodi Roberts and David Heller of Cushman & Wakefield represented Metro-North. SL Green was represented by its own in-house leasing team. SL Green officials declined to comment, while Cushman's brokers were unavailable at press time. Metro-North and the MTA could not be reached by press time.
The new rental agreement wasn't easily reached but, in the end, it gives SL Green much greater efficiency at its Grand Central area asset. “This was an exceedingly complicated transaction, which took nearly 20 months to complete and involved a plethora of moving parts, included the participation of numerous stake-holders,” says Steven Durels, EVP and director of leasing and real property for SL Green.
“The transaction has resulted in significant asset value creation,” he adds, “as large areas of the expansion space had previously been underutilized for storage, mechanical or corridor use and are now leased on a full market basis as office space.”
The expansion required assembling 34 separate spaces as well as the relocation or recapture of 15 occupied tenant spaces. Additionally, SL Green will perform all construction covering upgrades to building infrastructure and Metro-North's office build-out, including management of a multi-phased turn-key design/build solution necessary to meet a critical path timeline.
SL Green has signed 73 leases with tenants this year at the Graybar Building in addition to Metro-North covering over 456,000 square feet. Building occupancy will increase to over 94% after delivery of the Metro-North expansion space.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
