1400 Broadway. Picture courtesy of CommercialEdge
Flagstar Financial institution N.A., a subsidiary of New York Neighborhood Financial institution and the customer of the not too long ago collapsed Signature Financial institution’s liquid property, debt and repair facilities, has assumed the latter’s workplace lease at 1400 Broadway, a Class A, 919,405-square-foot workplace constructing in Midtown Manhattan.
The phrases of the lease, which spans 11 flooring and 313,109 sq. toes to be occupied by means of 2039, stay the identical, save for a $3 per sq. foot lower in lease within the first 5 years. Moreover, Empire State Realty Belief, the constructing’s proprietor and operator, will deduct $5.8 million from $6.4 million in straight-line reserve funding that had been collected over the primary quarter of 2023. In whole, Flagstar’s lease at 1400 Broadway will likely be decreased by 1.5 p.c.
Signature Financial institution’s Broadway historical past
Signature Financial institution’s lease at 1400 Broadway started in April 2018, encompassing 91,181 sq. toes throughout the sixth, seventh and 27th flooring of the constructing. Over the subsequent 4 years, the tenant expanded its Broadway footprint, greater than doubling its area to 280,182 sq. toes throughout 10 flooring in January 2022. The ultimate, 32,297-square-foot enlargement was signed in April of that yr. The places of work have been positioned inside half a mile from the previous financial institution’s company headquarters at 565 Fifth Ave.
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When Signature Financial institution closed in March 2023, it held property price a complete of $110.4 billion, together with $88.6 billion in deposits and $14 billion in business actual property loans. Every week after its collapse, The Federal Deposit Insurance coverage Corp. bought $38.4 billion price of Signature’s property, together with $12.9 billion in loans and all 40 of the financial institution’s branches, to New York Neighborhood Financial institution for $2.7 billion, in accordance with CNN Enterprise.
A Midtown Manhattan workplace property
The renovated foyer at 1400 Broadway. Picture courtesy of Empire State Realty Belief
Accomplished in 1930, the 37-story tower underwent renovations to its foyer, home windows, elevators, electrical, HVAC and safety methods in 2010, and was acquired by ESRT 4 years later for $310 million, in accordance with CommercialEdge data. Facilities on the LEED, WELL, Vitality Star and Fitwel-certified constructing embody personal lounges and assembly areas, a newly constructed meeting room and 18,000 sq. toes of ground-floor retail, in addition to MERV 13 air and particle filters.
Newmark Vice Chairman Scott Klau, Government Managing Director Erik Harris and Managing Director Neil Rubin presently oversee leasing and brokerage companies on the property. Its tenant roster consists of Kohl’s, Fragomen and Neon, amongst others.
Located in one of many borough’s most dense workplace corridors, 1400 Broadway is surrounded by a lot of Midtown’s retail, eating, cultural, leisure and hospitality choices. The constructing has fast entry to each native and categorical subway traces, and is inside 1 mile of each Grand Central Terminal and Penn Station.
An adapting workplace market
With a slowed growth pipeline and tepid deal volumes, the nation’s largest workplace market faces struggles with a lot of its core fundamentals. Partly, this has been on account of many comparatively fast modifications to how workplace work is carried out, introduced on by the pandemic and the recognition of hybrid work, in addition to the tenant flight to solely high-quality, amenity-driven areas. In keeping with CommercialEdge knowledge, Manhattan’s workplace emptiness price has elevated 210 foundation factors year-over-year to 16.5 p.c as of April, whereas its 15.1 million-square-foot pipeline marks a 21 p.c lower over the identical interval.
Nonetheless, the borough has been dwelling to current high-profile new leases and renewals. In January, Fox Corp. and Information Corp. prolonged their commitments at 1211 Avenue of the Americas, occupancies totaling 1.2 million sq. toes.
