Crains New York - February 18, 2013 - (Page 16)

THE LIST CoStar’s Top Office Leases NEXT WEEK: The most active venture-capital firms Biggest Manhattan transactions in 2012, ranked by square feet THE SCOOP TRENDS espite an improving economy, the 50 largest Manhattan office deals in 2012 were not only smaller than they were in 2011, but fewer of them involved tenants moving to new spaces, according to research provided to Crain’s from CoStar Group Inc. The total square footage of the top 50 transactions came to 12.8 million, down 6.7% from 2011. Furthermore, 29 of the deals were renewals or expansions—including all of the top 10. In 2011, 27 top deals fell into that category. “Office tenants are taking a conservative approach with their space needs in New York,” said Adrian Ponsen, a senior economist at CoStar.“Very few are making large expansions into pricey submarkets.They are instead renewing in places that expire.” Still, the 1.6 million-square-foot Viacom Inc. lease at 1515 Broadway ranked as the largest Manhattan office deal in a decade. In April, the media company renewed and expanded its then-1.4 million-square-foot space through 2031. The deal was one of 10 technology and media leases on CoStar’s list, half of which were in midtown submarkets. Because the area is attracting these types of tenants— as well as retailers who signed six of the top 50 deals, three in midtown—many properties are demanding higher rents. In Penn Plaza and the garment district, for example, asking rents grew 3.4%, to $41.16 per square foot, in the final quarter of 2012 from a year earlier, according to CoStar. Despite myriad problems, financial services continued to dominate leasing. It accounted for a dozen of the largest deals of the year, including the 1.2 millionsquare-foot Morgan Stanley Smith Barney lease at 1 New York Plaza (No.2),where the tenant renewed its lease and added 337,000 square feet. Even as financial service tenants signed deals, however, many also put space elsewhere in the city up for sublease. UBS, for example, renewed and expanded its lease at 1285 Sixth Ave. to 890,861 square feet (No. 3). But at the same time, it also offered several floors for sublease at 299 Park Ave., the home to some of its investment-banking operations. Leasing activity is expected to pick up in 2013. Already this year, there have been a handful of large deals, including the nearly 80,000 square feet snapped up by the American Arbitration Association at 120 Broadway earlier this month. “I definitely think we will start to see more leases pick up as GDP growth moves up and people become more confident,” said Mr. Ponsen. —emily laermer Industry breakdown Number of renewals grows as tenants stay put Financial service firms led the pack, signing the greatest number of large leases in 2012. In 2012, just 21 of the top deals were for new leases. In fact, all of the top 10 were renewed properties. Address 1 29 12 11 23 21 Technology/media 1515 Broadway 10 Retail 6 Government 5 Health care 4 Education 2 2008 2009 2010 2011 Changing neighborhoods Number of deals for the top six submarkets Penn Plaza/Garment 7 12,782,456 Total square footage leased in the 50 largest deals World Trade Center 7 Financial district 6 Plaza district 6 Grand Central 5 Times Square 5 3 1 Tenant Tenant representative Landlord/sublandlord Landlord/sublandlord representative Submarket Viacom Inc. CBRE SL Green Realty Corp. SL Green Realty Corp. Times Square 1,152,763 1 New York Plaza 2012 Includes space that was renewed and expanded. 1,606,000 1 29 27 Professional services Square feet 1 2 4 Financial services buck ennis D Morgan Stanley Smith Barney Newmark Grubb Knight Frank Brookfield Office Properties Inc. Brookfield Office Properties Inc. Financial district 890,861 UBS CBRE 1285 LLC Jones Lang LaSalle Columbus Circle 2 649,769 Davis Polk & Wardwell CBRE RXR Realty RXR Realty Grand Central 2 1285 Sixth Ave. 450 Lexington Ave. 5 601 Lexington Ave. 490,527 Citibank CBRE Boston Properties Inc. Jones Lang LaSalle Plaza district 6 100 Church St.2 372,520 New York City Law Department CBRE SL Green Realty Corp. Newmark Grubb Knight Frank World Trade Center 372,382 Bloomberg LP CBRE Eugene M. Grant & Co. Eugene M. Grant & Co. Hudson Square 362,907 Bank of America Merrill Lynch Cushman & Wakefield Inc. The Durst Organization The Durst Organization Times Square 361,044 Random House Inc. Cassidy Turley SL Green Realty Corp. SL Green Realty Corp. Columbus Circle 337,000 Milbank Tweed Hadley & McCloy Cushman & Wakefield Inc. JPMorgan Chase & Co. Newmark Grubb Knight Frank Financial district 7 2 340 West St. 8 114 W. 47th St. 9 2 10 2 1745 Broadway 2 1 Chase Manhattan Plaza 11 1 World Trade Center 270,104 U.S. General Services Administration Studley The Durst Organization/ The Port Authority of NY & NJ The Durst Organization World Trade Center 12 1372 Broadway2 264,692 Ross Dress for Less Studley Starwood Capital Group Direct deal Penn Plaza/Garment 262,000 BNY Mellon Jones Lang LaSalle Tishman Speyer Tishman Speyer Grand Central 13 3 2 200 Park Ave. 14 200 & 205 Hudson St. 257,580 Havas Newmark Grubb Knight Frank Trinity Church Real Estate Cushman & Wakefield Inc. TriBeCa 15 250 W. 55th St.3 246,374 Kaye Scholer CBRE Boston Properties Inc. CBRE Columbus Circle 16 1 State Street Plaza1 237,991 New York State Department of Financial Services Direct deal ACTA Realty CBRE Financial district 17 2 Penn Plaza2 225,045 Information Builders Inc. SL Green Realty Corp. Vornado Realty Trust Vornado Office Management Inc. Penn Plaza/Garment 220,359 Interpublic Group Jones Lang LaSalle Vornado Realty Trust Jones Lang LaSalle Plaza district 203,693 Microsoft Jones Lang LaSalle SJP Properties Jones Lang LaSalle Times Square 203,102 Chadbourne & Parke Newmark Grubb Knight Frank Paramount Group Inc. Paramount Group Inc. Columbus Circle 201,194 Macy's Merchandising Group CBRE Prudential Real Estate Advisors Monday Properties Penn Plaza/Garment 18 19 20 21 3 3 909 Third Ave. 3 11 Times Square 3 1301-1315 Sixth Ave. 2 1440 Broadway 22 33 Whitehall St. 180,519 Fitch Inc. Cushman & Wakefield Inc. Stawski Partners CBRE Financial district 23 101 Sixth Ave.3 175,692 New York Genome Center Newmark Grubb Knight Frank Edward J. Minskoff Equities Inc. Jones Lang LaSalle Hudson Square 165,029 Amerigroup Corp. Studley Roza 14W CBRE Financial district 159,412 Havas Newmark Grubb Knight Frank George Comfort & Sons Inc. George Comfort & Sons Inc. Murray Hill 146,677 U.S. Customs and Border Protection Studley Vornado Realty Trust Vornado Office Management Inc. Penn Plaza/Garment 144,916 Technical Career Institute Jones Lang LaSalle Overtime Properties Cushman & Wakefield Inc. Penn Plaza/Garment 24 25 26 27 1 3 14 Wall St. 2 200 Madison Ave. 2 1 Penn Plaza 2 320 W. 31st St. Continued on page 18 16 | Crain’s New York Business | February 18, 2013

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Crains New York - February 18, 2013