It could be a decade away, but two major building owners are discussing a joint venture to build a new office tower on Park Avenue.
Under the plan, Vornado Realty Trust would contribute the land under its office building at 350 Park Ave. and Rudin Management its mid-block tower at 40 E. 52nd St.
Such a deal would mean demolishing the current structure and building a new tower with a nicer and larger floor plate under the East Midtown zoning rules.
Vornado’s sits on the entire blockfront between East 51st and 52nd streets, while Rudin’s mid-block building at 40 E. 52nd St. sits right behind it with entrances on both side streets. This is a 23-story tower with 385,000 square feet and its main tenant, BlackRock, is moving to Hudson Yards and will leave it empty in roughly four years.
Sources said the firms have already discussed leasing such a new tower to a major company — but talk is cheap.
The East Midtown rezoning has spurred similar discussions up and down Park Avenue.
Rudin and Vornado also could renovate their current properties or even take them down and rebuild separately.
Both companies declined to comment.
The awards for Real Estate Board of New York’s 75th annual most ingenious deals of 2018 were handed out Tuesday night.
The first-place Henry Hart Rice Achievement Award went to Gregg Rothkin and Gerry Miovski of CBRE, who represented Sabey Data Centers in a lease for the top floors of 375 Pearl St. by architect Rafael Viñoly, who will have a new mezzanine for architectural models and a new terrace.
Jeffrey Rosenblatt of the Kaufman Organization won the second-place Robert T. Lawrence Memorial Award for his long search that brought the Open Jar Studios to 1601 Broadway, creating a place for Broadway shows and other performances to hold full-scale dress rehearsals.
The third-prize Edward S. Gordon Memorial Award was brought home by Alan Desino of Colliers International, who represented Evercore in a consolidation of its office space at Park Avenue Plaza.
Sublease space has become a factor in the market. It now totals 7.9 million square feet, which is the highest quarterly amount available since the second quarter of 2010.
Cushman & Wakefield’s second-quarter report also notes overall Manhattan asking rents increased $1 per square foot, to an eight-quarter high of $73.28 — as a result of higher-priced sublease space now available in Midtown South.
Broker Jeffrey Peck of Savills — a company that only represents tenants — says he is telling clients to wait as he thinks the asking rents will drop to beat the competition.
“A lot that is available has rents in the $40s and $50s per square foot and could wind up being in the $30s per square foot,” he says.
While that sounds like a dire prediction, it would be good news for tenants who want to take advantage of the numerous opportunities and move to better-quality space.
Building owner Grant Greenspan of the Kaufman Organization also sees “a steady diet of sublease space” in Midtown South from 5,000 square feet up.
At any given time, Greenspan says, 80,000 to 100,000 square feet of sublease space is available in Union Square, Flatiron and NoMad. “Some is built and furnished,” he said. “But the raw space is eaten up, too.”
