THE Upper East Side building housing Sotheby’s world headquarters is up for grabs and should fetch about $500 million.
Sotheby’s net leases the entire 470,000-foot building, which was developed by RFR Holdings specifically for the auction house five years ago at 1334 York Ave.
There are 16 years left on the lease, and the current rent is running about $40 a foot. But, according to the Jones Lang LaSalle brokers, despite increases every three years, the rent won’t even touch the current market rate of $60 to $65 a foot by even the end of the lease.
RFR COO Jason Brown says the developer wants to redeploy capital into development projects and more opportunistic investments.
“Sotheby’s [building] is a piece of art in itself, and we are taking advantage of the market,” Brown explained. They will leave the so-called coupon clipping to the buyer, who can simply sit back and enjoy the 4 percent to 4.5 percent income stream.
RFR has hired Tom Beneville, Nat Rockett and Noble Carpenter of Jones Lang LaSalle to market the investment.
Rockett said they are starting to garner a lot of interest, especially from international buyers. Sotheby’s does have sublet rights, but they are restricted, noted Rockett, on previous interest by the surrounding hospitals to take over the building.
Besides, he said, “How do you move Sotheby’s?”
RFR has also selected the Fearless Foursome – Richard Baxter, Ron Cohen, Scott Latham and Jon Caplan – of Cushman & Wakefield to market 90 Fifth Ave. That 129,418-foot building on the northwest corner of 14th Street is net leased to Forbes on a long-term basis.
Last year, Forbes subleased part of the top floor of the 11-story building to Bob Guccione Jr.‘s Discover Media.
“We’ve chosen a couple of select assets to take advantage of cap-rate compression [higher sales prices] and the market,” said Brown. Earlier this year, as we exclusively reported, RFR sold 2 Herald Square to the Sitt family.
While Brown declined to discuss pricing expectations for either building, it is likely that 90 Fifth will garner offers of around $100 million.
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A Milwaukee-based restaurant group is making its first foray into this area with a lease for its seafood concept.
Mo’s Restaurants signed a sublease for about 5,000 feet at the corner of 52nd and Lexington Avenue, which will become the eatery Moceans.
This spot in the Rudin Management’s 345 Park Ave. was formerly inhabited by the Broadway Diner on a lease from J.P. Morgan Chase.
Kim Mogull, CEO of Mogull Realty, represented the bankers and is the exclusive broker for Mo’s.
The asking rent for the space, she said, was $150 a foot.
Greg Weiser at J.P. Morgan Chase worked on the bank’s side while Tom Keating handled the work for Rudin.
“We’re now seeking a space for Mo’s steakhouse which is called, Mo’s A Place for Steaks,” Mogull said. A coffee house, Irish Pub, Italian and Asian restaurant are also being planned.
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Property owners who did not file Real Property Income and Expense forms with the Department of Finance last September will be allowed to file by May 1, the department said.
Many properties were whacked by vast increases in assessed value and penalized by losing the ability to have a review by the Tax Commission.
Especially hard hit were owner-occupied properties that were required to fill out a section stating why they didn’t need to file the form.
According to department spokesman Owen Stone, depending on the information provided, Finance might make changes to the tentative values before the final assessment roll is released on May 25.
No property owners were notified that they needed to make the yearly filing and, for the first time, forms were only available online.
Most properties have until March 1 to file a request for review by the Tax Commission with homeowners getting until March 15.
