Crains New York - August 13, 2012 - (Page 12)

REAL ESTATE DEALS M Tech firm lands on ‘northern fringe’ ulling acquisitions after a period of organic growth, digital advertising management company Operative Media has signed an eight-year lease for two floors at 6 E. 32nd St. The asking rent for the 30,720-square-foot lease at the building, which is owned by Himmel + Meringoff Properties, was $41 per square foot. The landlord was represented in-house by Mark Stein and Jason Vacker. Jim Wenk and Ryan Masiello of Jones Lang LaSalle represented Operative Media in its move from a building in the middle of the Flatiron district to the new space, in what Mr. Wenk called “the northern fringe of midtown south.” “We’ve seen tech companies expand the boundaries of their searches due to the limited amount of available real estate in midtown south proper,” he said. Mr. Wenk said the search took Operative Media from Gramercy to Chelsea to Union Square, and finally to East 32nd Street between Fifth and Madison avenues. As startups have crowded into midtown south, especially around the Flatiron Building, rents for office space have climbed steadily, forcing many young companies to expand their search. Among them is Lot18, a members-only online wine retailer headquartered at Operative Media’s future home on East 32nd Street. After the landlord performs some minor work on its floors, Operative Media plans to customize the space and take over the new office by November. —cara eisenpress Yeastier tenant mix looms for 370 Lex Zaro’s is sweet on Lexington. The bread- and pastry-maker recently renewed its lease for 2,900 square feet of ground-floor space at 370 Lexington Ave., between East 40th and East 41st streets, for another eight years. The 85-year-old Zaro’s has operated a storage and production facility at the space since 1998—but by early next year it expects to open a retail shop there as well. “They wanted to have an additional retail presence there,” said Adam Weissleder, who, along with colleague Jill Burrowes, represented landlord Sherwood Equities. “It’s a great location with a lot of foot traffic.” Zaro’s also operates four locations in Grand Central Terminal just up the street. The asking rent for the retail space at 370 Lexington Ave. was about $100 a square foot. The Zaro’s store will join another rising New York institution— Zucker’s Bagels & Smoked Fish, which operates a shop on Chambers Street, and which leased space at 370 Lexington Ave.earlier this year. —adrianne pasquarelli BARE BONES 485 LEXINGTON AVE. ASKING RENT; TERM: Undisclosed; seven years SQUARE FEET: 100,000 on 10th, 16th and 17th floors TENANT; REP: Xerox; Jones Lang LaSalle LANDLORD; REPS: Citibank; Bruce Mosler and Joshua Kuriloff of Cushman & Wakefield BACK STORY: The printer/copier company will sublease all of Citibank’s space in the building, which is owned by SL Green. 1177 SIXTH AVE. ASKING RENT; TERM: $66; 15 years SQUARE FEET: 68,000 on third floor, parts of second and fourth floors TENANT; REPS: Practising Law Institute; Patrick Gardner, David Goldstein, Howard Poretsky and Ira Schulman of Studley LANDLORD; REPS: Silverstein Properties; Frank Doyle and Paul Glickman of Jones Lang LaSalle BACK STORY: The nonprofit will be upgrading from the 6,000-square-foot space it had in SL Green’s 810 Seventh Ave. building. 15 E. 26TH ST. ASKING RENT; TERM: $55; 11 years SQUARE FEET: 20,000 on third floor TENANT; REPS: Jump Trading; Matt Carolan and Matt Felice of Jones Lang LaSalle LANDLORD; REPS: Savanna; Matt Astrachan and Mitchell Konsker of Jones Lang LaSalle BACK STORY: Savanna bought the bottom eight floors, all of which is commercial space, of the 20-floor building in February. IN THE BOROUGHS BROOKLYN Red Hook rising Continued from Page 3 always had younger people coming to the neighborhood, but I feel like the amount has just increased insanely. This year has been crazy.” Truth be told, gradual increases began in 2006, when Fairway Market opened its first Brooklyn outpost in a Civil War-era warehouse on the waterfront at the far end of Red Hook’s main drag, Van Brunt Street. Since then, car and foot traffic have been on the rise. At the dozen or so eateries along Van Brunt, locales make up most business on weekdays,but a growing number of summer day-trippers flip the script come Saturday and Sunday. For spots like Fort Defiance, a café lauded for its $10 New Orleans-style muffuletta sandwich,the impact is clear. “Sales have gone up every year,” said Fort Defiance owner St. John Frizell, who reckons his revenues have risen by nearly a third in the past couple of years. “I think people have a greater awareness of Red Hook and how to get here.” They come for local retailing giants Fairway and Ikea—which opened in 2008—as well as Steve’s Authentic Key Lime Pies and chocolate- and rum-maker Cacao Prieto, which offers tours by appointment. At Baked, a nearby coffee shop, sales have quadrupled since 2006. And Brooklyn Crab, a Maryland-style crab shack that opened this year across from Fairway, is packed on the weekends. “Red Hook is the ultimate stay- cation,” said Victoria Hagman, a broker for Realty Collective. People from gentrified Brooklyn neighborhoods like Williamsburg and Carroll Gardens are coming down in search of a cheaper, quieter place to live. But space is tight. Anyone hoping to rent a bayside loft above Fairway, for example, will have to wait behind at least 20 other dreamers,according to Ms.Hagman. In another sign of the times, Ms. Frantz Alexandre paid nearly $1 million for her renovated Van Brunt Street row house, more than three times what it sold for in an unrestored condition two years before. “The prices are definitely comparable to other neighborhoods with better rapid transit,” said real estate broker and resident Tina Fallon. FROM AROUND THE CITY BRONX buck ennis Bridges Juvenile Center, opened more than 50 years ago and most recently was home to 100 youth offenders. —amanda fung STATEN ISLAND Hunts Point eyes former jail UP AND COMING: Shops on Van Brunt Street Clouds over Staten Island New York’s least-noticed borough is getting a lot of attention this summer from City Hall. Following the hospitalization of a 50-year-old Staten Islander with this year’s first case of West Nile virus, the island has become the top destination for New York’s pesticide-spewing helicopters and trucks, bent on snuffing out the larvae of the mosquitoes that spread the disease, and the mosquitoes themselves. The latest spraying came earlier this month. This is the sixth dousing Staten Island has sustained, twice the number administered in secondplace Queens, and three times the total in the Bronx. Meanwhile, Brooklyn and Manhattan have yet to be sprayed. In 1999, the first big outbreak of encephalitis,which West Nile causes, infected 59 New Yorkers. Since then, there have been a total of 213 cases of the disease here. In the dozen years following, the Department of Health and Mental Hygiene has carefully monitored each borough’s mosquito population,applying chemicals when and where needed. During last year’s mosquito season, Queens held the title as the most-sprayed borough. —cara eisenpress Arty arrivals Most notably, this spring, photographer and art dealer Mirabelle Marden paid $1.6 million for a 2,000-square-foot home—a record for the neighborhood, according to real estate brokerage Corcoran Group—and sculptor Dustin Yellin snapped up a former Time Moving and Storage warehouse for $3.7 million that he hopes to turn into an arts hub he will call the Intercourse. Among others, it may draw some of Red Hook’s own burgeoning community of some 150 artists with studios in the area. Contrary to appearances,though, the neighborhood is one big bulwark against the forces of gentrification. The housing stock is small at best, and with most of the area still zoned for light manufacturing, that isn’t about to change soon. In fact, today most of the people—accounting for two-thirds of the area’s population of more than 10,000—live in the Red Hook Houses, a 30-building, 40acre complex built for Irish and Italian dockworkers in the late ’30s. Of course, Williamsburg was protected by zoning, too, until that changed wholesale in 2005, when a rezoning ushered in a glitzy new era of waterfront high-rises. Curiously, neighborhood pioneer Greg O’Connell,a former city policeman who five decades ago began buying up and restoring buildings in Red Hook,was one of the first to move on in search of greener property pastures. But Greg Jr. and his brother Michael keep the family’s 50-property, 1.3 million-square-foot Red Hook waterfront empire, the O’Connell Organization, buzzing with activity. “Red Hook is not set up for something that happened in Williamsburg,” Greg Jr. said. “Services are lacking here. A mass influx of residences would probably just strangle that.” A former juvenile detention center in the Hunts Point section of the Bronx is being eyed by the community as a possible sparkplug for economic development. The city says it will begin talking to community and local officials about redeveloping the Spofford Juvenile Detention Center, a 165,000-square-foot facility on Spofford Avenue that shuttered last spring. The former prison stands at the intersection of the industrial and residential areas of Hunts Point. “It’s an enormous site,” said Majora Carter, a local business owner, South Bronx native and community leader.“The possibilities for it are endless.” Among the options being eyed by the community are everything from housing, a community facility and a school to retail or commercial uses. Once the community outreach and preliminary redevelopment planning are wrapped up, the city will seek a developer for the site. A request for proposals will likely be issued in about a year, according to the city. “I am excited that the city has created a process to deal with the site,” said Ms. Carter. Spofford, also known as 12 | Crain’s New York Business | August 13, 2012

Table of Contents for the Digital Edition of Crains New York - August 13, 2012

Crains New York - August 13, 2012
Table of Contents
IN THE BOROUGHS
IN THE MARKETS
THE INSIDER
BUSINESS PEOPLE
CORPORATE LADDER
OPINION
GREG DAVID
REAL ESTATE DEALS
FROM AROUND THE CITY
REPORT: SMALL BUSINESS
THE LIST
CLASSIFIEDS
NEW YORK, NEW YORK
SOURCE LUNCH
OUT AND ABOUT
SNAPS

Crains New York - August 13, 2012