Deals Getting Done at 130 West 42nd Street - Daniel Geiger
CBRE teams begins filling openings that came with leasing downturn Canaras Capital Management has signed a lease for 5,000 square feet at 130 West 42nd Street, the 29-story building entire 15th floor. The deal is one of two to be done in recent months at the building, since the real estate firm that owns the property, American Properties Inc., hired a team from the brokerage CB Richard Ellis to manage the tower leasing.
The Outdoor Channel, a California-based television network that according to its website, offers programming that captures the excitement of hunting, fishing, Western lifestyle, off-road motorsports, adventure and other outdoor lifestyles also recently took space. The channel signed for 130 West 42nd Street entire 28th floor, a 2,500 square foot space that it plans to use for its Manhattan sales office. Asking rents in the deals were $40 per square foot, but because the leasing market still favors tenants even though deal activity and occupancy rates have begun to pick up in recent months both tenants could have negotiated lower rates.
The Outdoor Channel took over space that had been vacated by Platinum Funding, a boutique financial firm that remains a tenant in the building but negotiated with American Properties to downsize during the depths of the economic downturn. The space was desirable because Platinum had equipped it with an attractive office installation and also because it has access to an outdoor terrace with views of Bryant Park across the street. Paul Walker, a vice president with CBRE who, with another CBRE executive Jon Fales, leads the building leasing team, represented American Properties in the two transactions. Walker said that the move-in condition of the 28th floor at least allowed American Properties to avoid having to pay for costly incentives that many landlords have found themselves having to lay out for tenants during the weak period in the market, typically in the form of contributions to the construction work involved in preparing a space for occupancy.
The deal with Canaras, a firm whose website states it specializes in investments in corporate debt such as junk bonds, did require these incentives. Walker said that American Properties agreed to pay for a portion of the cost and oversee the work involved in outfitting its floor with a custom fit-out, what is known as a build-to-suit. The financial firm will be relocating from 1995 Broadway, a building near Lincoln Center at the upper fringe of midtown. American Properties, a real estate holding company owned by a Lebanese family, has owned 130 West 42nd Street for nearly 30 years.
The property, known as the Bush Building after its developer, Irving Bush, who erected the distinctive slim tower in 1917, had seen vacancy rise during the recession to around ten Advertisement percent, higher, according to Walker, than almost any other period during American Properties tenure as owner. The vacancy, Walker said, underscored just how much the midtown market had weakened last year. Walker said available space remains in the building, including the 8,000 square foot ninth floor, which has unusual 18-foot ceiling heights. He said that American Properties made shrewd upgrades to the building that have improved its ability to find tenants during the slowdown, including the decision to install additional windows as the company performed recent maintenance work on the facade. "Optimistic about the market at this point, Walker said. “The owners who have put money into their buildings and present the best product are going to lease space this year. Walker also said the roughly 200,000 square foot building14 floor, a 5,000 square foot space, is vacant. Ed Wartels of Cresa Partners represented The Outdoor Channel in its deal and Harry Greely, a broker at Cushman & Wakefield, represented Canaras.