Trio of office leases boost hopes at Class A buildings – The Real Deal

September 17, 2022

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From left: RFR Holdings’ Aby Rosen and Blue Owl Capital’s Doug Ostrover along with 3 World Trade Center (left), the Seagram building (middle) and 340 Madison Avenue (right) (Getty Images, Blue Owl Capital, Beyond My Ken, CC BY-SA 4.0 – via Wikimedia Commons)
A flurry of office leases reported Wednesday give hope to the Manhattan office market, particularly Class A Midtown spaces.
Private equity firm Blue Owl Capital signed a 137,600-square-foot lease at the Seagram Building, 375 Park Avenue, Bloomberg reported. The deal means Aby Rosen’s RFR Holding has signed 375,000 square feet of leases this year at the historic office tower.
In a release, RFR executive AJ Camhi called it a sign of the pandemic flight-to-quality that has seen tenants flock to prime Class A offices. But Blue Owl isn’t leaving behind a hovel — it’s coming to 375 Park Avenue from Boston Properties’ 399 Park Avenue, another Class A space less than five years off a $50 million renovation.
RFR is asking about $200 per square foot at the Seagram Building, a large premium over the Manhattan average of $75 a foot, according to Colliers. It recently poured $25 million into converting an underground garage at the property into a 34,000-square-foot meeting space workout-center-meets-meeting-space with room for 240 people and a boardroom.
Blue Owl was founded in 2016 and is led by Doug Ostrover, a co-founder of Blackstone’s alternative credit arm. It’s not the only finance firm to weigh in this week on the return-to-office debate: The Carlyle Group signed a 40,500-square-foot lease at RXR’s 340 Madison Avenue, Commercial Observer reports.
The private equity firm will take the entire eighth floor at Scott Rechler’s Midtown East office building, where asking rent is $75 per square foot, according to JLL. Carlyle had run out of room at its 194,700-square-foot headquarters in SL Green’s One Vanderbilt, where it has upped its footprint four times in the past four years.
Meanwhile, software outfit Asana added 44,000 square feet to its offices at Silverstein Properties’s 3 World Trade Center, according to CO. Asana, whose co-founder Dustin Moskovitz also co-founded Facebook, joins tech giants Spotify and Uber at the tower, where it already held 17,000 square feet. Silverstein was asking $135 per square foot for the space.

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