Meridian Brokers $60M Wells Fargo Loan for 85 Fifth Avenue Retail Co-Op Buy

85 Fifth Avenue.

Wells Fargo originated a $60 million loan to a partnership between Jeff Sutton’s Wharton Properties, General Growth Properties and Maguire Capital for the purchase of a retail cooperative property at 85 Fifth Avenue in Union Square, Commercial Observer has learned.

The three-year loan, negotiated by Meridian Capital Group Executive Vice President Aaron Birnbaum and Vice President Tal Savariego, carries a Libor-based floating interest rate as well as loan extension options, according to the brokers. Read More

Mortgage Observer

Lever House Loan Goes to Special Servicer

Lever House at 390 Park Avenue.

A $98.8 million CMBS loan on 390 Park Avenue, owned by RFR Holding, has been sent to special servicing with the note facing imminent maturity default, according to a Trepp report based on recent servicer data. CWCapital Asset Management is listed as the special servicer.

The news comes despite the fact that the 234,240-square-foot building known as Lever House is 96 percent occupied with its debt service coverage ratio at 1.33x, the property’s latest financials show. Read More

New Digs

Seagram Building Execs Score New Private Lounge

375 Park Avenue terrace

Before executives in the Seagram Building get to start flocking to the $4 million members-only 11th-floor lounge and terrace RFR Realty installed for them, Commercial Observer peeked into the art-filled living room area and tested the balcony’s rarefied air.

RFR’s Sheldon Werdiger invited CO for a tour of the 5,000-square-foot lounge area and 7,280-square-foot outdoor deck on a formerly-utilitarian platform where the brass and glass Ludwig Mies van der Rohe gem at 375 Park Avenue tapers into its tower floors. Read More

Year in Real Estate

Triple-Digit Boom: The Details Behind 2013’s Most Expensive Leases


In the exclusive confines of the Plaza district, a handful of elite financial services firms spent 2013 inking triple-digit leases—those deals carrying rents in excess of $100 per square foot. Once rare, these deals have skyrocketed in those few buildings boasting the unique infrastructure requirements for the world’s top money managers.

From Aby Rosen’s landmark Seagram Building to Sheldon Solow’s 9 West 57th Street, the triple-digit fraternity is an exclusive club for both landlord and tenant. Approximately 60 leases fell into the triple-digit category in 2013, the bulk of them signed during the second quarter, according to data from CompStak.

Below, The Commercial Observer breaks down the key figures and shines some light on the most expensive deals of 2013.

Read More

Power Broker

Silver Foxes: Massey Knakal Turns 25

Messrs. Knakal and Massey at their firm's 275 Madison Avenue headquarters. (Credit: Will O'Hare)

In the midst of the Savings and Loans Crisis of the early 1990s, Massey Knakal, a three-year-old commercial sales brokerage, was facing the prospect of going out of business for the second time in a matter of months.

By late 1990, the commercial sales market had all but dried up. Rather than pounding the pavement closing deals, Paul Massey and Robert Knakal were instead sitting in the office cold calling and playing solitaire—not on a computer but with a real deck of cards. Things got so bad that the firms’ partners had to fill out applications for numerous credit cards—$60,000 worth—to make ends meet. Read More

2013 Owners Magazine

No Sleep Till Brooklyn


When the Jehovah’s Witnesses began putting its portfolio of 35 buildings on the block in 2004, even the most seasoned real estate observer couldn’t have predicted that one of the winning bidders of a sprawling six-building complex in Dumbo would be Aby Rosen.

Known primarily as the owner of the Seagram Building and Lever House, two of the most iconic examples of mid-century modernism in Manhattan, Mr. Rosen and RFR Realty seemed unlikely suitors for a 1.2 million-square-foot compound in Brooklyn.

But similar to his cultivation of private equity and hedge fund tenants prior to the economic collapse, Mr. Rosen once again is tapping into New York City’s most exciting new business community–the rapidly expanding tech sector in Brooklyn. Read More

Power Broker

The Trophy Agent: RFR’s Steve Morrows

Credit: Fernando Pereira Gomes

Ten months ago, Clayton, Dubilier & Rice, one of the world’s oldest private equity firms, was looking to expand its space at the Seagram Building. Having spent a number of years occupying the entire 18th floor of the iconic building and a portion of the floor above, the firm was on the prowl to take the entire 19th floor.

With four additional tenants sharing space on the floor, complicated negotiations were imminent. Steve Morrows, executive vice president and director of leasing at owner RFR Realty, began devising a solution with his leasing team. The answer involved two lease terminations and two relocations within the building—all at the same time. Read More

Lease Beat

Epiq Bankruptcy Leads Trio of New Leases at 757 Third Avenue

757 Third Avenue.

Epiq Bankruptcy Solutions, a case management and consulting firm specializing in Chapter 11 cases, has signed a 28,036-square-foot lease on the third and seventh floors of 757 Third Avenue, the largest of three recently announced leases at the RFR Realty property. Asking rents in the building range from the low $50s to low $60s per square foot.

Additionally, real estate developer Omni Development and Astoria Federal Savings and Loan Association have signed lease for 5,700 square feet and 5,284 square feet, respectively.

“The RFR team works tirelessly to provide an unsurpassed office environment for our tenants – from the upscale building amenities and thoughtfully crafted interiors to the assiduous attention to architectural detail,” said Aby Rosen, co-Founder and principal of RFR, in a statement. “The recent leases at 757 Third Avenue are further testament to the quality of our portfolio and attention to tenant services.” Read More

Food & Drink

The Four Seasons Restaurant Faces Rent Hike

Four Seasons Grill Room 2

The Four Seasons Restaurant, home of the “power lunch,” is facing a six-fold rent increase when its current lease expires in 2016, The Huffington Post reported yesterday. The iconic New York eatery, which currently pays $19.74 per square foot, could be looking at rents of $125 per square foot for its 29,476-square-foot space inside the Seagram Building at 375 Park Avenue.

Documents viewed by the Huff Post indicate that as part of the owners’ $782.8 million mortgage deal, financed jointly by Citigroup and Deutsche Bank and being marketed to investors via commercial mortgage backed securities, bankers expect management at the property to begin charging the The Four Seasons market rents, which according to the documents are determined to be $125 per square foot. Read More

Lease Beat

Sister Companies Expand at 757 Third Avenue


Sister companies Aerotek and TEKsystems have signed 10-year leases for 13,551 square feet and 15,115 square feet, respectively, at RFR Realty’s 757 Third Avenue, it was announced today. Asking rents at the property range from the low $50s to low $60s per square foot and the total value of the transaction is over $16 million, according to a press release.

“The RFR team always works hard to provide the best services and amenities that attract and retain the best quality tenants,” said Aby Rosen, co-founder and principal at RFR, in a prepared statement. “That’s the secret of our success here and throughout the RFR portfolio.” Read More