Power Galas, leases and $ 5.7 billion sale of Cosmo – Commercial Observer
There is definitely something sunny going on in the New York office market.
Last month we saw Google pays more than $ 2.1 billion to execute the call option on the St. John’s terminal, which was by far the most exciting thing the office market has seen since 2020.
However, it was something that always seemed possible. Just a few months ago, Commercial Observer said that just that kind of eventuality was in the cards. Plus, Google was the kind of company for which a $ 2.1 billion purchase was, as one real estate professional involved in the deal joked, a “change of pocket.”
But then, this week, GFP and Northwind Group produced another flagship New York office event: They sold 100 Pearl Street (aka 7 Hanover Square) to German investor Commerz Real for $ 850 million, about $ 542 million more than they paid just three years ago. Granted, GFP and Northwind have invested around $ 250 million into the full asset modernization, but this is a truly phenomenal return on the 967,886 square foot asset.
Not as profitable, it turned out, as The Cosmopolitan. Blackstone sold the Vegas hotel and casino this week to a group that included Stonepeak Partners and the Cherng Family Trust for $ 5.65 billion. Blackstone bought it from Deutsche Bank for $ 1.8 billion in 2014, when the gigantic property looked like a money pit. They took hundreds of millions more to complete it, but, according to The the Wall Street newspaper, the sale makes The Cosmopolitan Blackstone’s the most profitable asset in the history of the company.
Hearing these kinds of numbers speak, it almost seems a little modest to talk about Miami Sale of Margaritaville for $ 270 million to Pebblebrook Hotel Trust, but it was the biggest hotel deal of the year in South Florida. (And there was some other interesting news about South Florida hotels: JPMorgan Chase granted $ 164 million bridging loan to refinance the new luxury hotel Goodtime owned by Pharrell Williams and David Gutman.)
Now, if anyone could make a similar deal for a hotel in New York, we would really be cooking on gas! Alas, the industry still seems pretty depressed.
But, let’s go back to the office for a moment …
Optimism in the office is not a New York phenomenon either. In LA, the Charles Company decided to nearly double the office space they’re introducing Melrose Triangle, and the Robertson Lane hotel project in Faring, just south of Santa Monica Boulevard, is proposing to reduce the number of hotel rooms and expand offices.
And, while the COVID peak of the summer has been an extremely painful experience for Florida in particular, the lax COVID restrictions have apparently made it so. little to dampen investors’ appetites in the Sun State. (Same fitness studio company Barry’s moves its head office from LA to Miami. You could say that everything will work out. He h.)
Of course, investors are not the only ones to move; tenants also see where it is all going. Cushman & Wakefield published a study showing that 40% of office workers worldwide have already returned at their desks. And at the end of last week, BlackRock announced that as of November 1, it was call employees back to the office for at least three days a week.
Namely, there have been extremely quick office rentals. Law office Lowenstein Sandler upgraded their 23,000 square foot lease at 1251 Avenue of the Americas; interior design firm The Switzer group took 16,000 square feet at 485 Park Avenue South; ODA New York, another architect, and Evergreen Trading each took 12,200 square feet at 99 Hudson; software developer UiPath took a full floor at One Vanderbilt; and, at 230, avenue du Parc (formerly known as the Helmsley Building), a pair of law firms, a pair of real estate companies, a charity, a finance company and a green energy company secured a total of 48,345 square feet of leases.
Looking for something dark
Of course, you can always find something to be angry or depressed about. Macy’s, for its part, isn’t too happy that Amazon has installed a giant billboard above its flagship Herald Square. They decided to sue the e-commerce company.
Those who have always believed in homeownership as a key part of the American Dream have also received disappointing news from RENTCafé that rentals are on the rise in 103 suburbs and ownership is in decline. (Although there are strong arguments as to why homeownership is neither the beginning nor the end of all.)
Finally, nothing can put you in a negative state of mind faster than think of Robert Durst. Looks like Durst is finally getting its performance. Why has Durst been an object of fascination all these years? Money? General strangeness? The three murders accused? (Although, just one conviction.) It’s something to ponder this Sunday.
And now for the humble boast
At CO, we remembered much of what we had missed over the past 19 months. This week, we hosted our annual Power Gala, our first in-person event since the start of the COVID-19 pandemic. And, so as not to beat our own drum too loudly, it was off the hook.
Nearly 200 of real estate’s most revered names joined us at 3 World Trade Center for cocktails, snacks, and to hear from Larry Silverstein, Mary Ann Tighe, Scott Rechler and more.
Read all about it here.
See you next week!