With foreign capital pouring into the U.S. real estate market and continued controversy over prohibitive tax initiatives, it’s a wonder any of the accountants The Commercial Observer contacted had time to speak with us for our semiannual accounting issue.
But the experts were happy to chime in about a range of accounting matters currently affecting the real estate industry.
Below, a breakdown of firms making the biggest moves.
A survey of more than 100 prominent commercial real estate machers states that Downtown Brooklyn is the neighborhood to watch, beating out heavy-hitters including Hudson Yards as the city’s Most Likely to Succeed.
“This could be another ‘prestige’ breakthrough for Brooklyn,” William H. Jennings, partner-in-charge of Marks Paneth & Shron, said in a prepared statement. “Many people already think it’s much ‘cooler’ to live in Brooklyn than Manhattan. It may soon be the ‘hot’ place to office.”
Jacobs Engineering Group has signed a 12,200-square-foot sublease on the fourth floor at Vornado’s Two Penn Plaza, The Commercial Observer has learned. Asking rent was $35 per square foot.
Rosenberg, Neuwirth & Kuchner, an accounting firm, had previously occupied the space on a sublease from Forest Electric. The firm was recently acquired by Marks Paneth & Shron and relocated to 685 Third Avenue. In turn, MP&S sublet the space to Jacobs when the engineering firm was looking to expand its presence in the building.
As we all know and dread, it’s tax season. Between that and the sustained political brouhaha over tax reform and the series of fiscal cliffhangers in Washington, it’s a wonder any of the accountants The Commercial Observer contacted had time to speak with us for our semiannual accounting issue.
But the experts were happy to chime in about a range of accounting matters currently affecting the real estate industry. It’s also not surprising given, each accounting firm’s workload, that the industry is rapidly expanding in New York.
Last year, Deloitte relocated to a 430,000-square-foot office at 30 Rockefeller Plaza while many of the city’s other top firms grew their employee ranks, possibly signaling future land grabs. Below, a breakdown of firms making the biggest moves.
Technology firm Epiq Systems is on the brink of signing a lease for roughly 100,000 square feet of office space at 685 Third Avenue, The Commercial Observer has learned.
A source familiar with the deal said it was slated to close towards the end of last week, but the deal had not closed by press time.
“A couple more days,” the source said.
Death and Taxes 2012
More than 300 real estate professionals crowded the Metropolitan Club early Thursday morning, despite snow-covered sidewalks, for the Observer Media Group’s third annual Masters of Real Estate forum.
Sponsored by Fried Frank and Marks Paneth & Shron, the event drew boldface names like Larry Silverstein and Mortimer Zuckerman, who spoke about the devastation wrought by Sandy, not to mention financiers like Angelo Gordon & Co.’s Adam Schwartz and Rockpoint Group’s Keith Gelb, who weighed in on opportunistic investments.
Below, reporter Al Barbarino walks the room and listens in on the panels, striving to put his finger on the commercial real estate industry’s pulse, minute by minute.
Death and Taxes 2012
It’s a good time to be a bean counter in the United States. The Bureau of Labor Statistics predicts that the industry will grow by 15.7 percent between 2010 and 2020, with an additional 190,700 accounting and auditing jobs up for the taking during the same period. The job itself, meanwhile, has its perks (the top 10 percent earn $106,880), especially in New York City, where professional accountants earn the highest wages in the country.
Couple that with New York City boasting the most powerful commercial real estate leaders in the land, why wouldn’t an accountant want to count beans for a major brokerage or construction firm? Death and taxes, sure, but life, too!
Here, below, are some of the top accounting firms in the area, including the size of their local and national real estate divisions, in no particular order. Although as many as 25 firms were contacted by The Commercial Observer, not all returned our calls by deadline. As such, some have been omitted entirely.
In the early part of the 2000s, as the real estate bubble continued to inflate, the use of 1031 Tax Exchanges as a shelter was, as Harry Moehringer of Marks Paneth Shron pointed out, probably one of the hottest accounting strategies on the American scene. Indeed, under section 1031 of the Internal Revenue Code, the IRS rule allowed the exchange of certain types of property to defer recognition of capital gains or losses upon their sale, therefore deferring capital gains taxes. Mr. Moehringer spoke to The Commercial Observer about how the section, which some call a loophole, is coming back in style.
If Leon Manoff were to sketch his nine-month search for office space on behalf of ASME, the 131-year-old association of mechanical engineers, it would look like a swirl of concentric circles, with each spiral extending farther from the organization’s space at 3 Park Avenue.
Over the course of his search, in fact, the Colliers International tenant agent toured floorplates 20 blocks north and more than three miles south, all across Lower Manhattan. In total, Mr. Manoff and his clients considered more than 30 buildings over the span of roughly 10 tours.
But as is so often the case, the building that ASME executives liked most of all was hiding in their own backyard, at 2 Park Avenue, directly out the window.