Upper floor rents of $200+ per sf highest seen since boom.
June 28, 2013 09:00AM
One of the world’s only publicly-traded hedge funds has renewed and expanded its lease at the Solow Building in Midtown, and will pay post-boom record rents of over $200 per square foot for the upper floors, according to data from CompStak. The deal at 9 West 57th Street could be worth north of $175.5 million, according to The Real Deal‘s calculations, likely making it one of the most valuable of the second quarter.
As part of the deal, Och-Ziff Capital Management Group — which has over $36 billion of assets under management — also expanded its presence at the 50-story, nearly 1.4 million-square-foot building, owned by the reclusive and litigious billionaire Sheldon Solow.
Och-Ziff will pay rent in the low $100s per square foot for the entire 13th-floor space, and in the $200s for the entire 39th and 40th floors, according to CompStak. Previously, the firm occupied only part of the 39th floor, as well as the 13th and 40th floors.
The upper floor deal bests even the one Solow struck in May with hedge fund Ruane, Cunniff & Goldfarb to lease the entire top floor of the building for just under $200 per square foot. Before the Och-Ziff deal, the Ruane, Cunniff & Goldfarb deal and Brazil-based Banco Itaú’s deal at the GM Building were the two priciest leases since the 2008 real estate boom.
Jones Lang LaSalle’s Scott Panzer, who oversees leasing at the building, did not respond to requests for comment. CBRE’s Peter Turchin, who brokered Och-Ziff’s previous lease, declined to comment. Jonathan Gasthalter, a spokesman for Och-Ziff, declined to comment.
The deal will see Och-Ziff’s total presence at the building increase to 95,200 square feet, and will keep it in the building until 2030. Och-Ziff’s current lease at the building was not yet due, according to CoStar.
Built in 1972, the Solow Building has a number of high-profile tenants, including real estate investment trust Apollo Residential Mortgage and French fashion company Chanel. But in a rarity for a Class A Midtown tower, it is only 69 percent leased, with over 430,000 square feet of vacant space, according to CoStar.
Last quarter saw a handful of mammoth leasing deals, including Macy’s office expansion at Vornado Realty Trust’s 11 Penn Plaza, which was worth between $620 and $633 million, asThe Real Deal reported.
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