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Entries in Commercial Real Estate (5)

Sunday
10Jan2010

Washington Poised to Pass NY with Higher Office Rents

DateSunday, January 10, 2010 at 10:39AM

The office market in Washington, D.C., is gaining on NY as the most expensive in the country and may soon become #1.

Commercial rents are down in most American cities.  The largest fall has been in New York, where average effective rents -- or the net amount tenants pay after landlord concessions -- fell nearly 20% to $44.69 per square foot annually. It was the sharpest decline in rents ever recorded.

By contrast, average rents in Washington were $41.77 per square foot, down just 3% annually. The WSJ estimates that by 2011, rents in New York will be around $41.07, while Washington DC will be closer to  $41.27.

"The financial crisis hit New York hard while government lobbying and federal jobs are growing.

AuthorG. Gotham | Comments Off |
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Wednesday
08Jul2009

Worldwide Plaza SELLS for a measly $330 per Foot!

DateWednesday, July 8, 2009 at 7:46AM

Worldwide Plaza is being sold for a price that looks more like a rental figure.

Deutsche Bank AG has agreed to sell Worldwide Plaza, a 1.8 million square-foot skyscraper in New York City, for $600 million to developer George Comfort & Sons and partner RCG Longview…

The sale price works out to roughly $330 a square foot.

Worldwide Plaza is a very high-class office building, home to, among other tenants, the swanky offices of Cravath, Swaine & Moore. It also has what until recently would have been something extremely attractive: a huge amount of unleased space (709,000 square feet, to be exact), vacated by the departing Ogilvy & Mather.

Today, everything has been turned on its head: those 709,000 square feet aren’t generating any income, and therefore have very little value. As a result, the 1.8 million square feet of Worldwide Plaza are worth just $600 million: by contrast, the $1.5 million square feet of 666 Fifth Avenue sold for $1.8 billion — or $1,200 per square foot — in 2006. On a price-per-square-foot basis, that’s a decline of more than 70% from the peak of the market

AuthorG. Gotham | CommentPost a Comment |
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Thursday
25Jun2009

Trophy Rents are Down...Way Down

DateThursday, June 25, 2009 at 9:03AM

The summer of 2008 was the time of $120-per-square-foot deals for Manhattan "trophy" office building rents -- a subset of the larger Class A marketplace:

Midtown towers like One Bryant Park and the GM Building—average asking rents reached the sky high price of $122.93 a square foot.   Since that time, things have cooled down a bit and are down to $104.14 a square foot.

We must point out that this is just the average, which means that certain floor and certain views are still getting much more.  Take, for example the 37th floor of One Bryant Park.  There, the asking rents topped out at $191 a square foot,

Fast forward to June 2009: Jones Lang LaSalle is about to release their in depth report that shows that midtown trophies are down 24%  since the Spring of 2008 and the average rents for these midtown towers could descend to the low $70s per foot by 2010.

 

AuthorG. Gotham | Comments Off |
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Friday
13Feb2009

Creating High Vacancies Is Part of the Plan

DateFriday, February 13, 2009 at 9:14AM

The Empire State Building has seen bad times before. During it’s early years in the great depression it operated with 77 percent vacancy rates and stretches of 20 empty floors at a time.

But wall the halls today and you can find large pockets of emptiness and papered-over windows. This time, it is by design. The Empire State Building has long been the home to large numbers of very small tenants. The new owners are trying to change that but before they can offer an entire floor to 1 company, they have reclaim the space from a single accountant here or a two man office there. So far their plan is working even though it is creating huge vacancies in the short temr.
In fact, in the past 18 months, the building’s owners, Wein & Malkin, have signed more full-floor tenants than the building signed in the previous 40 years.

Read More: NYT

AuthorG. Gotham | CommentPost a Comment |
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Monday
26Jan2009

Larry Silverstein Tempting Brokers with Free Super Bowl Tickets

DateMonday, January 26, 2009 at 11:29PM

In the fall of 2007, Larry Silverstein bought 1177 Sixth Avenue for $1 Billion.  Fast forward to 2009 and he is acting like all of the other anxious landlords in town.  While the building is 98% full right now, almost 100,000 sq ft are about to become available.  Making matters worse, hundreds of thousands of square feet of space are expected to hit the market this year as financial firms, law firms and others either disappear or retrench.

So what would you do to promote your new $1 Billion investment?  How about a cheap raffle aimed at commercial real estate brokers.  Silverstein is having an open house for brokers to show off the soon-to-be available space.  By attending, they will be able to enter a drawing for a trip to the Super Bowl.  It seems like a weak gimmick to me but these things usually work. For example, in October, Skyline Developers awarded five brokers who attended an event at its building at 1040 Sixth Ave. checks for $1,040. Six brokers received Nintendo Wii systems while four others won flat screen TVs.

Crains NY

AuthorG. Gotham | Comments Off |
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