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Commercial Observer
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Edited by Jotham Sederstrom | Jsederstrom@observer.com

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Tuesday June 05, 2012
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Multiple Tenants Circling 399 Park Avenue

At least two tenants are circling a block of office floors at the Midtown tower 399 Park Avenue, several sources have revealed to The Commercial Observer.

Epoch Investment Partners, an investment management firm, is considering two floors, about 50,000 square feet at the 1.75-million-square-foot office tower, which is owned by the large REIT Boston Properties.

Epoch is currently located at 640 Fifth Avenue, a roughly 320,000-square-foot building that is owned by the rival REIT Vornado. A source familiar with Epoch who didn’t want to speak on record because the company is publicly owned and the person was not cleared to give public disclosures said that it is expanding and has a lease that is rolling in 640 Fifth Avenue in 2015.

It isn’t yet clear however if the company intends to grow at 399 Park Avenue and retain its space at 640 Fifth Avenue or if it will consolidate eventually in the new location if it does the deal. The firm has been announcing steady increases in the amount of funds under its management in recent years.

The Jordan Companies, a private equity firm in the General Motors Building, is also in talks to relocate to 399 Park Avenue. The company, according to sources, is considering a single floor at the property.

399 Park Avenue has six vacant floors, 27 through 32, each about 24,000 square feet in size. The building, which serves as the world headquarters for Citibank, is known as a prestigious office address along Park Avenue and charges rents above $100 per square foot. It’s not clear which floors Epoch and Jordan were in talks to take amid the stack.

Another office tenant, whose identity The CO could not identify by press time, is also said to be circling the availability, for two more floors, meaning that Boston Properties could soon have commitments for the bulk of the building’s empty space.

The prospective deals come only a few weeks after Boston Properties negotiated to have Citibank renew its nearly 500,000-square-foot lease at 601 Lexington Avenue, a skyscraper it owns across the street from 399 Park Avenue - a transaction that significantly reduced that building’s vacancy exposure.

Executives at Boston Properties could not be reached for comment.

A CBRE leasing team represents Boston Properties at 399 Park Avenue. No executives at the company could be reached. Daniel Geiger is reachable at dgeiger@observer.com

Software Maker Inks at 292 Madison Avenue

QlikTech, a maker of business intelligence software, will be taking an entire pre-built office space on the 18th floor of 292 Madison Avenue, The Commercial Observer has learned.

QlikTech beat out a hedge fund for the pre-built space, which is sized at 6,035 square feet and priced at an asking price of $55-a-square-foot, said those close to the deal. The lease is for seven years.

William Cohen of Newmark Grubb Knight Frank represented Marciano Investment Group, the owners of 292 Madison Avenue. A brokerage team from Jones Lang LaSalle represented QlikTech in the deal. Herald Square Properties manages the building on behalf of ownership.

QlikTech becomes the second notable tech company to move into the newly refurbished 292 Madison Avenue, which has been actively pursuing technology firms since the Marciano Investment Group bought into the building’s ground fee and mortgage in 2011.

FiftyOne ECommerce took the 17th-floor pre-built space, also sized at 6,035 square feet, in March. FiftyOne ECommerce also has a fifth-floor space in the building, with a total footprint at 17,148 square feet.

QlikTech is replacing a law firm that moved out of the 18th-floor space after its lease expired.

“The previous tenant was not the direction that ownership was looking to go, whereas this [QlikTech] was exactly the type of tenant ownership wanted to move forward with,” said Mr. Cohen.

The pre-built offices are designed by the Mufson Partnership and features open space, high ceilings, and plenty of ambient light.

The 187,000 Class B office building is expecting two more vacancies sometime by the fall. Both of those spaces will be remodeled as pre-built space and be brought to the market around that time, said Mr. Cohen.

A spokeswoman for QlikTech did not immediately respond to an email and phone call requesting comment. The company services 25,000 companies in 100 countries.

Daniel Edward Rosen is reachable at drosen@observer.com

BlackRock Moves into Real Estate Securities

Investment manager BlackRock has launched a global securities division designed to capitalize on the firm’s real estate investment and fundamental equity investment expertise through investments in real estate securities.

Mark Howard-Johnson, formerly of Building & Land Technology, has been appointed to head the division, which is expected to take on about six more investment professionals by the end of the year, the company said.

As global head of Real Estate Securities Management, Mr. Howard-Johnson will lead a team whose mandate is to source investible trends in real estate.

“BlackRock real estate investments span a wide range of strategies which now, with the addition of the active strategy, will be even more integrated and complementary of each other,” Mr. Howard-Johnson said in a statement. “I’m proud to be part of this superior team and look forward to strengthening the firm’s product offering for the benefit of our clients.”

BlackRock’s global head of Real Estate Jack Chandler said that the move was “a natural extension of the firm’s robust real estate capabilities,” adding that it “will further strengthen our ability to offer our institutional and retail clients an unrivaled set of real estate solutions.”

Mr. Howard-Johnson was previously chief investment officer at Building & Land Technology, where he launched its real estate securities management division. He was also global head and chief investment officer of REIT management at Goldman Sachs Asset Management.

Carl Gaines is reachable at cgaines@observer.com

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