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December
August2014
2014

Year-End Summary - Record Highs Achieved

Our 2014 year-end report examines the trophy market performance over the past year, including:
changes in the vacancy rate and asking rents
deal volume above $100 per square foot
top tier buildings that outperformed the market
At year-end 2014, the vacancy rate for Midtowns trophy building submarket dropped to 8.0% from 10.6% from the
previous year. This decrease mirrors Midtowns general Class A vacancy rate which dropped to its lowest level since 2008:
10.7% (compared to 11.7% in 2013).
The Midtown average trophy asking rents for direct space increased 2.5% to $99.58 per sq. ft. from $97.29 at year-end
2013. This represents a 23% premium over Midtowns Class A asking rents which average at $80.86 per sq. ft. Asking rent
growth was steepest at the top of the market in the Plaza District, where trophy rents rose 6.5% and broke $100 per sq. ft. for the
first time since 2008, reaching $101.28 per sq. ft.
As predicted at the end of 2013, asking rents in the high-end market gained strength throughout the course of 2014. Tenants
may want to prepare for similar growth in 2015, particularly on preferred floors in the best buildings. Tenants can expect the
most desirable sector of the market trophy tower floors (i.e. those above the 25th floor) to continue to tighten. Vacancy on
these trophy tower floors is a mere 4.1%, dropping from its 5.0% vacancy level in 2013.
Through 2014, Landlords continued to offer robust concession packages, allowing tenants to offset substantial upfront capital
costs associated with building new office space, typically a barrier to relocating.
Midtown Trophy Market
Direct Rents and Overall Vacancy by Quarter
13.6%

Midtown Trophy Asking Rent (Direct)

14%

Midtown Trophy Vacancy Rate

8.5%

$99.58

$98.10

$97.33

$98.27

$97.29

$93.99

$92.43

$92.57

$93.81

$97.73

$97.10

$96.24

$98.11

$95.37

$91.98

$90.36

$84.65

$84.03

$83.28

$80.28

$84.82

$88.81

$90

$95.96

12.1%
12%

10%

8.0% 8%

6%

$60
2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14

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December
August2014
2014

Deal Trends - $100 per sq. ft. Transactions

In 2014, 97 transactions were completed at starting rents of $100 per sq. ft. or higher. Over the past several years, the number of
these $100+ deals has increased consistently and has finally exceeded the 2008 peak of 91 deals. Despite the ever-increasing
number of these high-end deals, it should be noted that they represent a relatively small portion of the total leasing volume in
Midtown Manhattan in 2014 (12%) approximately 2.7 million sq. ft., yet significantly above the 1 million sq. ft. of top tier deals in
2013.
The average size of transactions that achieved starting rents of at least $100 increased to 28,583 sq. ft. This number is skewed
upwards by several unusually large transactions that occurred in 2014. These three deals all exceeded 350,000 sq. ft. and were
early renewal commitments with forward pricing. Excluding these three anomalies, the average size lowers to 16,415 sq. ft. Other
trends include:
The majority of these deals were completed by financial services tenants:

32 hedge funds
19 private equity firms

25 other financial (investment

banks, wealth management)

21 other non-financial
(legal, consulting, software)

For the first time ever, buildings in Midtown South welcomed tenants at rents north of $100 per sq. ft. 51 Astor Place signed
four deals over $100 per sq. ft. for a total of 63,096 sq. ft., and a new 56,000 rsf lease at 837 Washington Street in the
Meatpacking District had a starting rent of $125 per sq. ft. 610 Broadway is another new entrant to the $100 club with its 27,601
sq. ft. lease, as well as 635 Avenue of the Americas, with a lease of approximately 10,000 sq. ft.
There were 27 buildings in the $100 club last year, and 33 buildings in 2014, indicating a wider concentration of properties.
9 West 57th Street has achieved the highest starting rent in Midtown for the past several years, reaching $210 per sq. ft. in 2014.
Since 2010, 375 Park Avenue (The Seagram Building) has attained the highest number of transactions with rents over $100 per
sq. ft. 14 transactions were completed in 2014, compared to 12 in 2013.
Landlords with the largest number of $100+ deals are Boston Properties (19 deals 1.1 million sq. ft.), RFR (17 deals 124,145
sq. ft.), and Vornado (10 deals 93,589 sq. ft.).
The three largest deals were renewals / forward commitments ranging from 350,000 sq. ft. to 489,495 sq. ft.
$100+ per sq. ft. Transactions - Completed in 2014
16
14

Number of Transactions
14

12
10
8
6
4
2
0

8
6

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December 2014

$100+ per sq. ft. Transactions

Deal Size
40
35

37

Number of Deals

30

31
29

25
20
15

28,583 sq. ft.

average size

10

(16,415 sq. ft.

excluding the
large outliers)

5
0
< 5,000 s.f.

5-15,000 s.f.

> 15,000 s.f.

Top-Tier Transactions Starting Rents

Record Levels Achieved
$80 to $99

200

$100 and Greater

180
160

Number of Deals

140

97
81

120

91

100

51
50

80

80

56

60
18

40
20
0

14

80
57

18

35

17

14
2004

19

69

2005

2006

2007

2008

2009

69
46

83
58

26
2010

2011

2012

2013

2014

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December 2014

Newly Available Sublease Spaces

Building
Photo

Building

1140 Avenue of the Americas

One Bryant Park

520 Madison Avenue

Address

N/E/C West 44th Street

N/W/C of West 42nd Street

Between 53rd & 54th Streets

Ownership

The Blackstone Group LP

The Durst Organization

Tishman Speyer

Floor / sq. ft.

Entire 11th floor / 12,750 rsf

Partial 39th floor / 7,168 rsf

Partial 32nd floor / 7,443 rsf

Asking Rent

$75

$96

$95

Term

Through March 2021

Through September 2018

2-3 years

Sublandlord

City MD

Marathon Asset Management

Hisox Insurance

Comments

Space is built with 9 offices, 1

large conference room and 2
small conference rooms,
open seating for 40, a pantry
and an employee lounge.
Features light on 3 sides and
comes furnished.

High end installation with 3

offices, open area, 3
conference rooms, pantry and
reception. Furniture is
available.

Space is built as a trading

floor with 42 positions, 3
offices, 3 conference rooms,
and 2 pantries. Light on 3
sides and Central Park views.
Occupancy is 5/1/2015.

Floorplan

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December
August2014
2014

Newly Available Sublease Spaces

Building
Photo

Building

444 Madison Avenue

599 Lexington Avenue

40 West 57th Street

Address

Between 49th & 50th Streets

Between 52nd & 53rd Streets

Between Fifth & Sixth

Avenues

Ownership

Westbrook Partners

Boston Properties, Inc.

LeFrak Organization

Floor / sq. ft.

Partial 18th floor / 3,025 rsf

Entire 45th floor / 8,618 rsf

Partial 15th floor / 13,500 rsf

Asking Rent

$68

$94

$75

Term

3-5 years

Through September 2020

Through August 2017

Sublandlord

Realex Capital Corp.

Cornerstone Research

PJT Partners

Comments

Sublessor occupies the

entire floor and is leasing the
southern portion with 5
offices, open space, and
shared use of the conference
room and terrace. Furniture
and phones are available.

Recent high-end installation

featuring 16 offices, 1
conference room, IT, pantry,
and open space for 2.

Recently built high-end

installation with 4 glassfronted conference rooms, 14
glass-fronted offices, large
open area for trading or
support, pantry, reception, IT
closet, storage and a private
bathroom. Furniture and
phones are available.

Floorplan

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December 2014

Newly Available Sublease Spaces

Building
Photo

Building

527 Madison Avenue

535 Madison Avenue

545 Madison Avenue

Address

S/E/C East 54th Street

N/E/C East 54th Street

S/E/C East 55th Street

Ownership

Mitsui Fudosan America, Inc.

Park Tower Group

Thor Equities

Floor / sq. ft.

Entire 10th floor / 8,600 rsf

Entire 11th floor / 14,375 rsf

Partial 12th floor / 8,830 rsf

Entire 17th floor / 6,577 rsf

Asking Rent

$65

$83

$75

Term

Through September 2018

Through May 2022

Through May 2021

Sublandlord

Wunderlich Securities

Tigris Investments

Super Derivatives

Comments

Fully furnished plug-and-play

trading installation with 12
glass-fronted offices, open
area for trading, 8-person
conference room, reception
and pantry. Direct extension
possible.

E. 11 High end build out with

16 exterior offices, 8 interior
offices, 6 wired trading stations,
conference room, file room and
large foyer/ gallery and pantry.
P. 12 - 12 exterior offices, 16
workstations, 5 interior offices,
conference room, and pantry.

Newly built space, plug-andplay with brand new furniture,

6 offices, 2 conference rooms,
18 workstations, a pantry, and
a IT/storage room. Space also
has a useable terrace.

Floorplan

P. 12

E. 11

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December
August2014
2014

Newly Available Sublease Spaces

Building
Photo

Building

630 Fifth Avenue

650 Fifth Avenue

712 Fifth Avenue

Address

Between 50th 51st Streets

S/W/C West 52nd Street

S/W/C West 56th Street

Ownership

Tishman Speyer

Wharton Properties

Paramount Group, Inc.

Floor / sq. ft.

Partial 28th floor / 17,749 rsf

Entire 31st floor / 10,988 rsf

Entire 44th floor / 9,777 rsf

Asking Rent

$25

$79

$90

Term

Through January 2016

Through May 2018

Through January 2018

Sublandlord

AlpInvest Partners

Mistral Equity Partners

Merchants Gate Capital

Comments

8 month sublease in highend built space with trading

layout including 22 offices, 31
workstations, 3 conference
rooms, pantry, and IT.
Furniture and direct
extension available.

Space is built with modern

finishes and includes 13 offices,
3 conference rooms, open
space, a pantry, and an IT
room. Furniture is not included.

High end build out with 9

offices, 3 conference rooms,
pantry, IT, and open space.
Move in ready with furniture
and phones. Direct extension
possible.

Floorplan

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December
August2014
2014

Newly Available Sublease Spaces

Building
Photo

Building

135 W 50th Street

1411 Broadway

1500 Broadway

Address

Between Sixth & Seventh

Avenues

Between 39th & 40th Streets

Between 43rd & 44th Streets

Ownership

135 West 50th Street, LLC

Ivanhoe Cambridge, Inc.

Tamares

Floor / sq. ft.

Partial 8th floor / 21,750 rsf

Partial 12th floor / 6,394 rsf

Entire 30th floor / 12,850 rsf

Asking Rent

$45

$50

$70

Term

Through December 2019

Through January 2017

Through August 2024

Sublandlord

Quad Graphics

Wild Tangent

Nasdaq

Comments

Quality installation built with 5 Space is built with 7 perimeter

offices, open space, 1
offices, 92 workstations, 2
conference room and a pantry.
conference rooms and 1
training room for 40 people.
Furniture and phones are
available.

Floorplan

Space is built with 15

perimeter offices, 11 internal
offices, 3 conference rooms,
open space for 25, a pantry,
and an IT room. Landlord will
provide $35-45 in TI for
cosmetic upgrades.

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December
August2014
2014

Newly Available Sublease Spaces

Building
Photo

Building

950 Third Avenue

666 Third Avenue

320 Park Avenue

Address

S/W/C East 57th Street

Between 42nd & 43rd Streets

Between 50th & 51st Streets

Ownership

ANA Real Estate LLC

Tishman Speyer

Mutual of America Life

Insurance Company

Floor / sq. ft.

Partial 4th floor / 1,200 rsf

Partial 17th floor / 4,331 rsf

Partial 19th floor / 3,913 rsf

Asking Rent

$15,000 per month

$62

$80

Term

Through November 2015

Through July 2016

2 - 3 years

Sublandlord

P3 Global Management Inc.

Truven Health Analytics

Audax

Comments

Shared, fully wired, space

built with 4 offices and
support area for 7. Tenants
have use of the shared
conference room and shared
kitchen. Monthly rent is an all
in number.

The space is built with 8 offices, Brand new high-end

installation with 5 offices, 1
1 conference room and an
conference room, 10
open area.
workstations and a pantry.
The space is fully furnished
with Knoll furniture.

Floorplan

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December
August2014
2014

Newly Available Sublease Spaces

Building
Photo

Building

114 W 41st Street

420 Lexington Avenue

757 Third Avenue

Address

Between Broadway &

Avenue of the Americas

Between 43rd & 44th Streets

N/E/C East 47th Street

Ownership

LH Charney & Associates

SL Green

RFR Realty LLC

Floor / sq. ft.

Entire 19th floor / 15,626 rsf

Partial 3rd floor / 1,816 rsf

Partial 24th floor / 4,344 rsf

Asking Rent

$38

$53

$58

Term

Through January 2016

Through November 2018

Through December 2018

Sublandlord

Navigant Consulting

San Jon, Inc.

Laura Pomerantz Real Estate

Comments

High-end existing installation, Built corner unit with 1 corner

built with 48 work stations, 17 office/conference room and
perimeter offices, 2 large
open space.
conference rooms, and 7
small conference/ team
rooms. The space has an
exposed ceiling and an IT
room with supplemental
HVAC. Furniture is available.

Floorplan

1 year old high-end pre built

with 6 glass fronted offices, 1,
conference room, open area,
and pantry. Furniture and
phones available.

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December
August2014
2014

Recently Completed Transactions Financial Service Firms

Type

Tenant

Address

Square
Feet

New

TD Bank

One Vanderbilt

200,000

New

Mitsubishi UFJ Trust and Banking

1221 Avenue of the Americas

93,402

Renewal

Glenview Capital Management

767 Fifth Avenue

41,000

New

Nordea Bank

1211 Avenue of the Americas

40,429

Sublease

Allied Irish Bank

300 Park Avenue

40,000

New

Clearing House

1114 Avenue of the Americas

32,000

Renewal

Lexington Partners

1 Penn Plaza

20,000

New

SHL Investments

9 W 57th Street

19,885

Expansion

Mizuho Corporate Bank

1251 Avenue of the Americas

19,556

New

Virtu Financial

900 Third Avenue

18,294

Sublease

Folger Hill Asset Management

900 Third Avenue

18,245

New

Brightwood Capital Advisors

810 Seventh Avenue

17,320

Sublease

GreensLedge

399 Park Avenue

12,132

Expansion

Point72 Asset Management

330 Madison Avenue

9,800

New

Daruma Capital Management

1120 Avenue of the Americas

9,562

New

DH Capital

810 Seventh Avenue

8,760

New

Certares

350 Madison Avenue

8,559

Expansion

Freddie Mac

200 Park Avenue

8,299

Sublease

Permanes Capital

545 Madison Avenue

7,179

New

Braemar Energy Ventures

350 Madison Avenue

7,178

Sublease

SAB Capital

767 Fifth Avenue

7,000

New

Praesidium Investment Management

1411 Broadway

6,976

Renewal

LSV Advisors

540 Madison Avenue

6,950

Renewal

Compass Group

135 E 57th Street

6,850

New

Twin Capital Management

250 W 55th Street

5,630

New

Beach Point Capital Management

350 Park Avenue

5,375

New

Glazer Capital

250 W 55th Street

5,230

For further information, please contact:

Cynthia Wasserberger at 212.812.5816 or cynthia.wasserberger@am.jll.com

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December
August2014
2014

Cynthia Wasserberger
Managing Director
(212) 812-5816
Cynthia.Wasserberger@am.jll.com
Cynthia has been actively involved in providing real estate services to financial service clients over
the past 18 years. She assists key prime brokerage groups and focuses on transaction work for
numerous boutique hedge funds and investment management firms. She has completed over 100
deals in this arena. Cynthia holds a business administration degree from University of Florida, and
a Master of Science in Real Estate Finance from New York University. She is an active member of
The Real Estate Board of New York and the New York University Real Estate Alumni Association.
She is also involved with The Doe Fund organization in New York, and was recognized in 2009 as
a Woman of Valor by the Capuchin Food Pantry / St. Francis of Assisi.

Jonathan Schifrin
Senior Vice President
(212) 812-5832
Jonathan.Schifrin@am.jll.com
Jonathan Schifrin is a senior vice president in JLLs New York Office and is a tenant representation
specialist. Mr. Schifrin has more than eight years of experience in the commercial real estate
industry. Mr. Schifrin holds a master of science degree in real estate from New York University and
a bachelor of arts degree from Emory University. He is actively involved with Israel Bonds and
serves as a vice chairman of the New Leadership Cabinet.

Hayley Shoener
Associate
(212) 812-6535
Hayley.Shoener@am.jll.com
Hayley Shoener is an associate in JLLs New York office and specializes in tenant representation.
Ms. Shoener focuses on business development, market research, transactional support and
financial analysis. She also worked as an intern at JLL in both the Research and Brokerage
departments in 2012. Ms. Shoener graduated cum laude from Boston College in 2013 with a
bachelor of arts degree in History and a minor in French. She is a member of the Real Estate Board
of New York.