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Roundup

Real Estate Roundup 2.24.20

11 Penn Plaza (Credit: Taidgh Barron/NY Post)

Real Estate Roundup

Office leasing 

  • Apple is negotiating to lease office space at Vornado’s 11 Penn Plaza. The 1.15-million-square-foot building has 638,921 square feet available from the fourth through 14th floors as a sublease from Macy’s. The tech giant is looking to take roughly 200,000 square feet in the middle of the building. (NYPost)
  • Concord Music has signed a 15-year lease for 46,329 square feet spanning the entire fifth and sixth floors Empire State Realty Trust’s 250 West 57th Street. Asking rent on the deal was $69 per square foot. (NYPost)

Retail

  • Spanish retailer Desigual has leased 5,200 square feet at 605 Fifth Avenue between East 48th and 49th streets, with 2,300 feet on the ground level and the rest lower-level storage. The current tenant, Sunglass Hut, is moving across the avenue. (NYPost)
  • New York supermarket chain Fairway Market filed for bankruptcy protection yesterday with a proposal to sell its Manhattan stores to the Village Super Market Inc., which operates ShopRite, for $70 million. The deal was characterized as a “stalking horse” agreement, which means other businesses could also put in bids on the properties. (WSJ)
  • How Fairway Market lost its way: numerous missteps and a nationwide disruption in the supermarket industry. (NYTimes)
  • Clothing retailer Express is expecting to close 100 stores… The store closures add to the malaise that U.S. shopping malls have been hit with in recent years. A record of more than 9,000 store closures was announced by retailers — ranging from Gap to Forever 21 to Sears — in 2019. The apparel category within retail has been under pressure especially with more shoppers either pulling back their spending on clothing, or turning to subscription services. (CNBC)
  • Secured creditors are recovering all or most of their investments when retailers file for bankruptcy protection, even as nearly half these companies don’t survive with a physical presence… First-lien lenders’ average recovery rate was 91%, including for asset-backed loans, cash-flow revolvers, term loans and secured bonds. Second-lien creditors had a median recovery of 41%, while those with unsecured note claims realized mostly poor recoveries of less than 10% of par value. (WSJ) 

Development filing

  • Vicki Zhi has filed plans to develop an 106,000-square-foot project at 136-18 Maple Avenue in Flushing. The 14-story building would include 68 residential units, along with commercial and community space. (TRD)

Other news 

  • Investors are continuing to pay top prices for apartment buildings in many parts of the country, despite growing political support for rent control measures that could make this business riskier. Harbor Group bought a portfolio of 13,243 apartment units in eight southern and mountain states valued at $1.85 billion earlier this month. Kushner Cos. also agreed to buy 1,058 units in a deal that values the apartments at $266.5 million. Both firms say they are planning to drive profits by increasing rents, a strategy that is coming under attack from lawmakers throughout the U.S. Investors predict that rent hikes will continue to outpace inflation in many parts of the country because housing production remains below what it was at peak levels. (WSJ)
  • Madison Equities and Gemdale Properties’ supertall condo at 45 Broad Street will be delivered shorter and later than expected. The condo project is being put on hold due to “market conditions.” (TRD)
  • Joseph Beninati filed for personal bankruptcy in Texas this week, listing some $24 million in liabilities — mostly from the personal guarantee he owes from his unrealized sky-high luxury condo tower project on Sutton Place. (TRD)
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