Tenant Leasing Assignments:

               

Northwestern Mutual Life has been a valued client for over 20 years. On a recent assignment , we simultaneously sublet their existing space, 54,000 rsf, at 1114 Avenue of the Americas while arranging relocation to 45,000 rsf at 245 Park Avenue.

We mutually concluded that the office market was about to experience a substantial spike in rental rates over the next few years.  Our client's lease at 1114 Avenue of the Americas expired in 2009, on or about a time frame when we felt that rents might peak. We determined that a preemptive move in advance of the anticipated rental spike was in order. 

To obtain corporate backing, we had to demonstrate that we could achieve two positive outcomes.  First, demonstrate that a preemptive move would reduce the client’s overall Occupancy Cost over the long term against our waiting out the remainder of lease term to when one may typically have had to commence negotiations.  Second, our occupancy costs would have break-even on what our occupancy would have been over the balance of the current lease.

Fortunately, there were contiguous tenants on the floors above and below who needed expansion space.  We were able to generate an auction environment, in which one of these tenants sublet our premises above "fair market", but at a break-even expense to us.  Concurrently, we negotiated a lease at 245 Park Avenue for 45,000 rsf, reducing or occupancy by 10,000 rsf, while achieving a competitive rental over a seventeen-year lease term. The outcome was that we greatly exceeded the two prerequisites that had been mandated.

Morgan Stanley/Dean Witter has been a client since 1986. Our initial assignment entailed a review of occupancy alternatives for the Operations Group of Dean Witter. Our conclusion, was that the best option was to remain in place and expand, saving million in upfront build-out expenses associated with a relocation. Concurrently, we were able to obtain valuable Tax concessions from NY State to remain in New York.

In 1992 we were retained to procure new space for the Inter-market Group (asset management); the initial occupancy of 185,000 rsf has grown to 405,000 rsf. We have recently re-cast it into a new long-term position.

Starting in 1996, we were also retained to periodically review and restructure Morgan Stanley / Dean Witter’s principal downtown leasehold positions totaling 1.6 million square feet at the World Trade Center. The rental in the existing lease had been back-loaded, where the last 5 years involved a sizeable rent bump. We were able to restructure the rent cash-flow so that operating groups would be spared a large hit that their profit centers would otherwise have had to absorb.

In the aftermath of the 9/11 attacks, MS/DW turned to us to identify and negotiate for space to replace part of the facilities that had been destroyed at the World Trade Center. Within weeks we arranged for occupancy of 650,000 rsf on a flexible, short-term basis so that a new comprehensive plan could be devised with a new outlook in mind.

In 2005 and 2006, after having formulated a long-term occupancy strategy, we concluded a long-term lease restructure of a 405,000 in Jersey City.  Concurrently, we arranged the leasing of an additional 285,000 square feet of space at One New York Plaza, in lower Manhattan. All of this at a lower occupancy cost than we would have incurred, had we committed long-term after 9/11.

Scarola & Ellis first signed a lease at 888 Seventh Avenue in 1996.  Their ten-year lease contained an extension option at “fair market” rents for an additional five years.  The building owners, who had moved their headquarters on our client’s floor and two other contiguous floors, had no interest in our client remaining where they were, yet our client did. Upon exercising our option, we commenced an arduous arbitration process.  Following months of reports stating each other’s claim as to “fair market”, a third-party, independent arbitrator decided with us, and awarded a rental of $71 a foot, $21 a square foot lower than the Landlord’s claim of value. Shortly thereafter, the landlord entered into a new lease on similar space at over $100 a foot.

MFS Communications Co

MFS Communications retained us to simultaneously identify, negotiate, and procure office and switching sites in 26 markets throughout the US and Canada.  As MFS was a fast-growing company in a mad rush to gain market share over its competitors, we were given an unusual amount of leeway to make the types of decisions typically made by our Principals.  This included advising legal council for the final determination of the lease documents.  We were left to determine which locations met the client’s physical, location and technical demands.  Consequently, within a 16-month period, we concluded 28 leases in 26 locations and the client was up and operating and generating revenue ahead of their projected time frame.

Asset Management Assignments:

As Asset Managers for an estate that had a 50% interest in various retail properties in Easthampton, NY, we were both an advisor and intermediary on all aspects of the properties pertaining to our client’s income interests in those properties. We also provided recommendations in determining the best formula for financing capital for leasing expenses and maintenance issues.

As owners/asset managers for Westhampton retail complex bought in 1983 for $280,000, and sold for $3.6 million dollars in July of 2007, when we determined that the real estate market was headed for a dramatic correction downward accompanied by rising Cap Rates.  The credit markets experienced their first trauma in late August of the same year and, as projected, values have fallen dramatically.

We have recently been engaged as Asset Managers for a group of family investments valued at over $60 million dollars.  This portfolio consists of prime luxury retail properties and office space in Manhattan.  A current issue that we are focused on in this down market is maintaining the rent roll and renewal of tenants whose leases roll over.  We are also determining the best solution to deal with tenants who, due to the business downturn, have been requesting rent deferrals.