Taconic Nears 150K s/f Bronx Deal
Daniel Geiger March 30, 2012, 12:30 p.m.
Taconic Investment Partners is nearing a roughly 150,000-square-foot deal with the city’s Human Resources Administration at the BankNote Building in the Bronx.
The Human Resources Administration, which operates the city’s food stamp program and provides public health insurance, senior care, HIV/AIDS support and other social services, has been in talks to take space at the property for months but it has remained uncertain if a deal would get done.
“We’re hopeful that we’re getting very close to a deal,” Charles Bendit, Taconic’s co-chief executive office told The Commercial Observer.
“The deal at the BankNote Building should be finalized within the next 3 months,” Carmen Boon, the HRA’s press secretary, wrote in an email.
The roughly 400,000 square foot building was a derelict warehouse in the Hunts Point section of the South Bronx when Taconic purchased the property in 2007 at the height of the real estate market. At that time, the company saw it could serve a burgeoning market of areas outside of Manhattan offering companies a lower cost options as rental rates soared in more centrally located areas like Midtown.
“We saw at the time that a lot of the non-profit companies were being priced out of the city and we realized we could create a really interesting space opportunity for them for rents at $25 per square foot,” Mr. Bendit said.
Mr. Bendit said Taconic, which has invested in a number of successful buildings in the city, including its spectacular sale of 111 Eighth Avenue last year for almost $2 billion, spent about $20 million renovating the historic building. According to Mr. Bendit, the firm paid around $30 million to acquire the property.
“It’s a really cool loft office building,” Mr. Bendit said. “What we like to do is transform things, like we’ve done in Chelsea (where 111 Eighth Avenue is located).”
But then the economy and the real estate market crashed, dealing Taconic’s plans a setback.
“Today, you can find space for $30 to $35 a foot in Lower Manhattan,” Mr. Bendit said.
Working with the Denham Wolf Real Estate to lease the property, Taconic persevered through the trying times and found takers for the space, including two charter schools, a business incubator and the Bronx Academy of Arts and Dance among others. The deal with the HRA would be the largest lease signed at the property and would nearly fill it. But getting it done hasn’t come without its own hurdles. According to written reports, the prospect of the deal drew ire from some community groups for the way it might bring unsavory individuals who visit the HRA into such close proximity to students. Eventually those concerns appeared to become difused and the local community board in the fall voted to approve the HRA deal. Now finally, it appears close to finally getting signed.
“Listen, I think we’ve done a wonderful thing,” Mr. Bendit said. “We’ve converted this building over to a use that over time will serve the community well.”