Disney’s purchase of 304 Hudson, 50 Vandam, 275 Spring, along with 137 and 147 Varick streets that will all be demolished for its new 4 Hudson Square headquarters, has meant all the office tenants have to move.
Because the tenants signed leases some time ago with the then-Trinity Real Estate-owned building and all had demolition clauses, their current rents are way below market.
It became a huge challenge for broker Jeffrey Peck of Savills Studley to find his two clients, the electronic exchange, OTC Markets, and the fashion house, 3.1 Phillip Lim, cool space at a reasonable rent.
Luckily, Peck says more quality and longer-term sublease space is now available because his tenants are not downsizing but are reconfiguring their offices to hold the same number of employees in less space.
Thus, they have high-quality space with newer installations to sublease.
Additionally, since Brookfield redeveloped the entire former World Financial Center and added the kiosks and food markets, the Class A project is now considered cool.
“We found a way into the now trendy Brookfield Place at rents that OTC and Phillip Lim were used to paying,” Peck said.
OTC Markets has now subleased 33,183 square feet on a portion of the 12th floors at 300 Vesey St. — the former 1 North End Ave. — from Virtu Financial.
OTC was repped by Peck, Daniel Horowitz, Howard Poretsky and Roi Shleifer of Savills Studley, while Virtu was repped by Michael Lenchner of Sage Realty working along with Frank Doyle, Cynthia Wasserberger and Andrew Coe of JLL.
Meanwhile, 3.1 Phillip Lim is moving to 21,000 square feet on a portion of the 33rd floor of 225 Liberty that was subleased from Commerzbank.
Designer 3.1 Phillip Lim was repped by Peck, Shleifer, Horowitz and Christopher Foerch of Savills Studley, while Commerzbank was represented by Daoud Awad and Scott Cahaly of JLL.
Brookfield cooperated in approving all the deals by in-house brokers, Mikael Nahmias and David McBride.
The sublease asking rents were in the $50s per square foot, far below a direct deal.
