term space and 33,000 sf of mid-term space at nearby
Yards, bringing the total lease to approximately 133,000 sf.
Intercept expects to move to 10 Hudson Yards in May 2017.
ROCKEFELLER GROUP’S HOME RUN
In October 2016, Major League Baseball signed a new lease for
approximately 400,000 sf at 1271 Ave. of the Americas. The iconic
48-story office tower was completed as part of the modern expansion of Rockefeller Center to the west side of Sixth Avenue.
MLB and MLB Advanced Media plan to consolidate employees
into six floors of the 2.1-million-sf building from separate locations
in Midtown and Downtown and are scheduled to take control of
the space in 2018—with occupancy expected for 2019. As part of its
agreement, MLB will have the right to use the building’s street-level
plaza for public events, as well as exclusive use of the eighth-floor
outdoor terrace overlooking Sixth Avenue. The office space was
previously occupied by
Time Inc., which had
been the building’s
anchor tenant for more
than five decades before
the publisher’s relocation
MLB was represented
by a CBRE team including Scott Gottlieb, Ken
Herlihy and Daniel
Wilpon. Building ownership was represented by a
CBRE team including
Mary Ann Tighe, Howard
Fiddle, John Maher, Dave
Caperna, Evan Haskell
and Sarah Pontius, in
coordination with an in-house Rockefeller Group
leasing team led by Ed Guiltinan and Jennifer Stein. On the legal
front, the landlord was represented by Steven Klein and Gary Litke
of Gibson Dunn, while the tenant was represented by Chris Smith
and Peter Strauss of Shearman & Sterling.
A LONDON HEDGE FUND IN NEW YORK
As one of the project’s signature towers reached the finish line,
another one crossed the starting line with a comparably jumbo-sized construction loan. The project is Hudson Yards, the largest
private real estate development in US history, and the financing of
35 Hudson Yards demonstrates its appeal to global capital and
high-profile global investors.
The investor in question was London-based Children’s Investment
Fund Management, which provided a $1.2-billion debt financing
round to a joint venture of Related Cos. and Oxford Properties
Group in connection with the construction and development of 35
Hudson Yards. The remainder of the 1.1-million-sf mixed-use build-
ing’s $2-billion price tag is being covered by an equity investment
from an undisclosed source. Slated to rise 1,000 feet upon comple-
tion, 35 Hudson Yards will include the first-ever Equinox Hotel, lux-
ury condos and retail and office space, including Equinox’s global
headquarters. It’s the second building at Hudson Yards financed by
CIF, which provided partial financing for the 15 Hudson Yards resi-
dential tower the prior year. A Fried Frank team of Michael J. Barker,
Suzanne Devries Decker, Amanda M. Barner, Ted B. Slevin and
Samantha E. Kaufman represented CIF.
EAST SIDE STORY
Hudson Yards may be the largest private real estate project New York
City has seen since Rockefeller Center, but it’s not the only high-profile transit-oriented development in town. On Manhattan’s East
Side, SL Green Realty Corp. is set to go vertical this year with One
Vanderbilt Ave., a planned 1,401-foot office tower adjacent to Grand
Central Terminal, now that it has landed construction financing.
A lending group led by Wells Fargo and including Bank of New
York Mellon, JPMorgan Chase
Bank, TD Bank and Bank of
China provided $1.5 billion in
financing this past September.
The multiple-draw construction
loan facility will finance the
development of One Vanderbilt,
which will contain approximately 1. 7 million gross sf of
office, retail and amenity space,
and will also finance the construction of certain onsite and
offsite transit improvements.
The loan has a term of up to
seven years and bears interest at
a floating interest rate of 3.5%
over LIBOR, with the ability to
reduce the spread to as low as
3% upon achieving certain pre-leasing and completion milestones.
Skadden’s Harvey Uris led a team that included Christy L.
McElhaney, Sarah Ralph and David Polster to represent SL Green
in the financing. The transaction also involved the negotiation of a
joint venture between SL Green and Hines Interests LP.
One Vanderbilt is meant to be a centerpiece of the broader
rezoning of Midtown East, intended to facilitate new construction
in an area known for aging office stock. Although the ambitious
Midtown East proposal hasn’t reached final approval, SL Green
secured a narrower rezoning for the Vanderbilt Avenue corridor
that enabled it to pursue construction of the new tower. Fried
Frank has represented SL Green on a range of actions needed for
this development, including zoning approvals allowing for additional development rights and negotiations with the Metropolitan
Transportation Authority and City of New York. The Fried Frank
attorneys on those efforts were Tal J. Golomb, Zachary Bernstein,
Stephen Lefkowitz, Nicholas R. Williams and Danielle R. Frank.
A LOVE AFFAIR WITH MAJOR MANHATTAN MULTIFAMILY
When it comes to multifamily, the Blackstone Group has had a banner couple of years. In the largest transaction of the asset class in New
York City last year, the private equity firm picked up Kips Bay
Court—an eight-building, 894-unit rental complex, for $620 million.
Reports published prior to the close of the deal revealed that an
offering memorandum listed the property’s projected net operating income for 2017 at about $23.9 million, with the potential to
grow to $41.6 million per year by 2027.
Built by affordable housing developer Phipps Houses in 1975
under New York State’s Mitchell-Lama housing program, the eight-building asset exited that system more than a decade ago, with all
1271 Avenue of the Americas