Mortgage Observer

Multifamily Financing in Manhattan Faces Rising Hurdles

(Illustration by Thomas Pitilli)

While Manhattan is clearly one of the most desirable places on the planet to live—and much ink has been spilled over rising rental prices therein—there is another side to the coin. The sky-high land values that come along with rising rents are now keeping a firm lid on multifamily development in Gotham.

Despite the enormous demand from renters, lenders are far more interested in financing luxury condominiums, hotels and office and retail development in Manhattan, sources told Mortgage Observer. And while developers and bankers cite myriad economic and practical reasons for the hampered development pipeline for multifamily projects, the ever-loftier land costs are the bedrock issue. Read More

Lease Beat

Revlon Relocates to 1 New York Plaza

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Revlon has reportedly signed a 15-year lease for the top two floors at Brookfield Office Properties1 New York Plaza in a relocation from 237 Park Avenue, joining a flight of value-seeking firms to recently head Downtown.

The 91,194-square-foot lease covers floors 49 and 50, the latter of which is a glass box-style penthouse with 15-foot ceilings, according to the New York Post, which first reported the deal earlier this week and noted that former occupant Goldman Sachs removed columns from the space to accommodate their trading floor. Read More

MO's Top 50

Jonathan Pollack Takes Top Spot On This Year’s 50 Most Important People in CREF

Jonathan Pollack

Deutsche Bank’s CMBS guru and real estate financing head honcho, Jonathan Pollack, took the No. 1 spot on this year’s 50 Most Important People list due to several colossal deals and his team’s top ranking in the global and U.S. securitized debt markets.

While the German global banking and financial services company reported an unexpected overall loss of 965 million euros, or $1.3 billion, for the fourth quarter of 2013, its real estate debt operations have continued to show clear gains. Read More

Mortgage Observer

HKS Negotiates $120 Million Loan from Goldman Sachs for 12 East 88th Street Acquisition

12 East 88th Street

In one of its largest brokered deals in the last year, HKS Capital Partners has arranged a $120 million loan from Goldman Sachs for Simon Baron Development Group’s acquisition of 12 East 88th Street in Carnegie Hill, Manhattan.

Ayush Kapahi, a founding partner at the boutique brokerage firm, negotiated the three-year loan out of HKS Capital’s Manhattan office, Mortgage Observer has exclusively learned. Read More

Lease Beat

Comerica Expands at 230 Park Avenue

230 Park Avenue in lit in Seattle Seahawks colors for the Super Bowl

Comerica Incorporated has expanded by 7,286 square feet on the sixth floor of 230 Park Avenue, the building’s landlord announced this week.

The Dallas, Texas-headquartered financial services company now occupies a total of 13,158 square feet at the Monday Properties and Invesco-owned building. The company has steadily grown its presence at 230 Park Avenue over the past year, expanding by 2,000 square feet in 2013 to approximately 5,900 square feet. Read More

The Lobby

Marty Burger Officially Takes Over as CEO of Silverstein Properties

Marty Burger

Marty Burger has been appointed as chief executive of Silverstein Properties, the company announced today, taking over sole ownership of the title he previously shared with Larry Silverstein.

Mr. Burger, who held the title of co-chief executive for two years during a period of transition, will take over responsibility of the real estate company’s day-to-day operations. A veteran of the industry, the 48-year-old first joined Silverstein Properties in 2010 after stints with Goldman Sachs, Blackstone, Related and Artisan Real Estate Ventures, a firm he founded. Read More

Mortgage Observer

Q&A: Peter Sotoloff, Managing Director and Head of Originations at Blackstone Real Estate Debt Strategies

Peter Sotoloff

Mortgage Observer met with Mr. Sotoloff, who BREDS Managing Director and Chief Investment Officer Michael Nash calls ‘employee No. 1.’ He spoke about his experience on both the financing and development/acquisition sides of commercial real estate and the opportunity to help establish Blackstone’s debt business in the fall of 2007. Read More

Lease Beat

Law Firm Renews, Expands at 230 Park Avenue

230 Park Avenue.

McKenna Long & Aldridge LLP has signed a 12-year renewal at Monday Properties230 Park Avenue.

The law firm has increased its space by 2,000 square feet in the deal and will now occupy 32,052 square feet on the entire 17th and a portion of the 18th floor. The tenant has increased its space in the building by 50 percent since moving in in 2007.

Read More

Mortgage Observer

Lawyer’s View: CMBS

Michael Gambro.

Michael Gambro

Cadwalader, Wickersham & Taft Co-Chair of the Capital Markets Department

Cadwalader has provided lead counsel services in several of the largest single-borrower CMBS transactions ever. What kinds of challenges have those deals presented?

Read More

Lease Beat

Reed Elsevier Closes Deal at 230 Park Avenue

230park

Professional information firm Reed Elsevier has signed a 10-year, 71,083-square-foot lease for the entire seventh floor at 230 Park Avenue, The Commercial Observer has learned.

“By its size and the tenant on its own, [the deal] means a lot,” Brian Robin, president of Monday Properties, said. “The tenant has exceptional credit and is a very stable organization, which is our sweet spot.” Read More

Lease Beat

Lee Hecht Harrison to Relocate to 230 Park Avenue

230 Park Avenue

Lee Hecht Harrison, a subsidiary of Adecco USA, has signed a 10.5-year, 23,000-square-foot lease for a portion of the sixth floor at 230 Park Avenue. The global mobility talent firm will relocate from nearby 200 Park Avenue.

“230 Park Avenue continues to earn the trust of leading organizations such as ING, Clarion Partners and Novartis,” said Brian Robin, president of Monday Properties, in a statement. “We are proud to add Lee Hecht Harrison to the tenant community of our landmark building, where we provide leasing solutions for small and large firms alike.”

Read More

REIT Beat

Flagship Retail Locations Could Spell REIT after Hudson’s Bay, Saks Deal

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Hudson’s Bay Company will explore the creation of a real estate investment trust as the company’s proposed acquisition of Saks Inc. stands to add a number of flagship retail locations to the company’s portfolio. HBC agreed to acquire Saks for $16.00 per share in an all-cash transaction valued at $2.9 billion.

The merger will create a large real estate portfolio that will include the Saks Fifth Avenue locations on Fifth Avenue in New York and Wilshire Boulevard in Beverly Hills, as well as Lord & Taylor’s Fifth Avenue location. Read More

Lease Beat

Leasing Activity Remains Steady at Boston Properties’ 510 Madison

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Financial services tenants have been flocking to Boston Properties510 Madison Avenue and three recent deals indicate interest remains high, despite triple-digit rents. The Canada Pension Plan Investment Board, 400 Capital Management and Prosiris Capital Management have all signed 10-year, 11,500-square-foot full floor deals in the building, a source familiar with the transactions confirmed with The Commercial Observer. Read More

Financing

Gary Barnett Seeks $1B Loan from Chinese Bank

Gary Barnett

Gary Barnett, founder of Extell Development, is seeking approximately $1 billion in financing from Export-Import Bank of China for the planned condominium development at 225 West 57th Street, The Wall Street Journal reported earlier today.

If the deal is closed, it would likely be the largest loan for a U.S. real estate construction project since the market downturn, according to the Journal report. The project, as designed, would be the largest residential building in the United States, rising just a block away from Extell’s soon to be completed One57 residential tower.  Last year, Nordstrom agreed to anchor the development with its first New York flagship location. Read More