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by REW | December 12, 2019
Marx Realty (MNPP) announced that content targeting company ZEFR signed a 15,000 s/f 10-year lease on the 13th floor at 10 Grand Central, relocating from 292 Madison Ave.
On the heels of signing data onboarding service Crux Informatics, insurance giant MassMutual and Agence France-Presse, 10 Grand Central continues to attract firms enamored by the tower’s hospitality-infused aesthetic.
Marx Realty has signed 193,000 s/f of new leases since the announcement of the building’s repositioning in mid-2018. During that time, occupancy has increased from 78 percent to 93 percent.
“ZEFR is the type of cutting-edge tenant that gravitates towards the authentic and highly designed hospitality-like office space that uniquely defines 10 Grand Central,” said Craig Deitelzweig, president and CEO of Marx Realty.
High-profile tenants at 10 Grand Central include Dwayne “The Rock” Johnson’s production company, Seven Bucks Productions; UK-based sports private equity firm 23 Capital; asset management firm Everside Capital Partners; and, educational technology company Decoded.
The recent completion of a redesigned four-story entry portal, marquee, lobby, lounge, Ivy terrace, and 40-seat conference space was part of the $48 million repositioning of the 35-story Ely Jacques-Kahn designed office tower.
JLL’s Cynthia Wasserberger, Sam Seiler, David Kleiner and Carlee Palmer are handling the leasing for Marx Realty. TAsking rents range between $82 and $130 psf.
ZEFR Continues Marx Realty’s Leasing Streak at 10 Grand Central
December 2, 2019
Content targeting company ZEFR signed a 15,000-square-foot, 10-year lease at Marx Realty’s 10 Grand Central. The company is relocating from 292 Madison Ave.
JLL’s Cynthia Wasserberger, Sam Seiler, David Kleiner and Carlee Palmer are handling lease-up at the repositioned Midtown East property. Since Marx Realty began the property’s $48-million makeover in mid-2018, occupancy has increased from 78% to 93%.
“ZEFR is the type of cutting-edge tenant that gravitates towards the authentic and highly designed hospitality-like office space that uniquely defines 10 Grand Central,” said Craig Deitelzweig, Marx Realty’s CEO. “They instantly fell in love with the warm and inviting nature of the building, and they know that no other space would better help them in attracting the best talent in New York.”
Other recent signings at 10 Grand Central include Crux Informatics, a Goldman Sachs-based provider of data onboarding services; insurance giant MassMutual and international news agency Agence France-Presse.
Modernization, Preservation of Iconic ‘Department Building’ Now Complete DowntownPOST BY: KAMILLE D. WHITTAKER | NOVEMBER 22, 2019
Local design firm ASD | SKY managed the redesign.
The 1920s-era Regenstein’s Department Store at 207 Peachtree just got a new name and feel.
A $10.5 million hotel-like modernization and preservation of the newly dubbed “Department Building” by New York-based Marx Realty now offers 20,000 square feet of retail and 30,000 square feet of modern creative office space, walking distance from MARTA’s Peachtree Station.
“The repositioning has allowed us to maintain the building’s original and authentic character while modernizing it with state-of-the-art office space suitable for today’s technology-driven tenants,” said Craig Deitelzweig, President & CEO of Marx Realty in a press release.
The historic building envelope as well as the original Art Deco design elements have been preserved which includes features such as 18-foot ceiling heights, terracotta barrel-vaulted ceilings, fluted columns, and original wood floors, as well as the expansive loft-style floorplates and oversized windows.
What’s new: a dedicated lobby and a rooftop deck that will provide unobstructed views up and down Peachtree Street and of Stone Mountain.
Marx Realty announced earlier this year that Saito – Sushi, Steak and Cocktails and restaurateur Stephen de Haan inked a deal to lease 2,200 square feet of space on the first floor of the building.
BY REBECCA BAIRD-REMBA | NOVEMBER 26, 2019 9:57 AM
Los Angeles-based video advertising company ZEFR is moving into Marx Realty’s 10 Grand Central in Midtown East, according to the landlord.SEE
The video targeting platform is leaving nearby 292 Madison Avenue for 15,000 square feet on the 13th floor of the 35-story, Art Deco office tower at the corner of East 44th Street and Third Avenue. Asking rent in the 10-year lease was $86 per square foot.
JLL’s Cynthia Wasserberger, Sam Seiler, David Kleiner and Carlee Palmerrepresented the landlord in the deal, while Cresa‘s Jane Roundell and David Toomey handled the transaction for the tenant.
ZEFR “wanted to look at Midtown South initially and what they liked about 10 Grand Central is that it’s a Midtown South building but more conveniently located and with more amenities,” explained Marx CEO Craig Deitzelweig. “Initially they were attracted to another floor and we leased that space, so we moved some tenants around to get [them] a larger space. It’s just a testament to their desire to be in the building.”
Marx recently completed a $48 million renovation of the building that included a new lobby, a new four-story entrance on the East 44th Street side of the building, prebuilt office suites, and a 1930s-inspired lounge and terrace with a fire pit and plantings on the seventh floor.
Other tenants in the building include data management startup Crux Informatics, MassMutual, asset management firm Everside Capital Partners, the Association of National Advertisers and Dwayne “The Rock” Johnson’s company, Seven Bucks Productions.
Why Own a Property When You Can Profit From the Dirt Below?The practice of creating ground leases is becoming more popular
By Peter Grant | Nov. 26, 2019 7:00 am ET
Instead of buying or developing buildings, more commercial real-estate investors want only the ground beneath them.
The practice of separating a property from the land, and then renting out that ground to a developer on a long-term basis, is known as creating a ground lease. It is viewed as safer than owning the property because real-estate risk mostly falls to building owners, who usually need to finance a purchase or construction, pay for future renovations and fill the space with tenants.
“You just own the dirt,” said Darcy Stacom, chairman of CBRE Group’s capital markets group in New York.
The business has ballooned in recent years as the prices of most major types of property have rallied for most of the past decade and are starting to look expensive.
This year, investors created ground-lease deals for at least seven major New York City buildings, including the H&M anchored office building on Fifth Avenue and the historic American Telephone & Telegraph Co. building in the Financial District, according to CBRE. The firm knows of only one such deal in 2018.
Investors are also buying the land under properties in Washington, D.C., Philadelphia, San Antonio and Austin, according to buyers and brokers.
The deals still carry some risk for the ground owner. Ground rents typically rise over the term of the lease, but they could fall far behind inflation over the decades, causing the ground lease to lose value.
Owners of buildings, meanwhile, may find it increasingly hard to finance properties on someone else’s land. When the lease expires, land owners get to own the buildings.
“Down the road, there’s typically a day of reckoning that happens,” said Jade Rahmani, an analyst at Keefe, Bruyette & Woods who follows the ground lease business.
Still, some investors see the business only growing. Jay Sugarman, chief executive of the real-estate investment iStar Inc., said investors have barely scratched the surface of separating the ground below trillions of dollars of U.S. commercial real estate.
“We’ve only touched a fraction of it,” he said.
In June 2017, iStar spun off a business that specializes in creating and owning ground leases, now known as Safehold Inc. Mr. Sugarman, who is also chief executive of Safehold, expects the real-estate investment trust to own assets with a total value of $2.5 billion by the end of this year, up from $340 million when it did its initial public offering.
Dividing properties into the land and the structure goes back centuries. Land owners create a long-term ground lease up to 99 years. The leasehold owner pays a ground rent. While the landowners get ownership of the buildings when the lease ends, in most cases they prefer to create a new lease.
Some of the most well-known New York skyscrapers, such as the Chrysler Building, are on leased land.
For a number of years the ground-lease business was discredited by a number of high-profile financial shocks. This was because formulas for rent increases were often dictated by land values. In New York, as values soared, such increases have triggered financial headaches for building owners.
With Lever House, a New York City office building, developer RFR Holding LLC hasn’t been able to refinance the Park Avenue tower because the ground rent is set to rise from $6.15 million to more than $20 million in 2023, according to people familiar with the matter.
“Everyone has an anecdote of a horror story from a ground lease that destroyed value,” said Mr. Sugarman.
An RFR representative declined to comment.
Ground leases are now being structured without the onerous reset provisions that base rent increases on property values. Most new resets are tied to inflation and capped beyond a certain level.
“No one will agree to the old structure,” said Craig Deitelzweig, chief executive of Marx Realty, which has been in the ground-lease business for much of its 104-year history.
These new long-term leases are attractive to investors who want to control a building but hold their costs down, said Joe Bous, a principal at Valor Ground Lease Ventures, which specializes in this business. Investors typically can get back 30% to 40% of what they pay by selling the ground lease, he added.
“If you could lock in about one third of your value structure with 100-year money, isn’t that a good thing if you believe interest rates are going to go to five or six or 7%?” Mr. Bous asked.
Zefr Signs 15,000-Square-Foot Lease at 10 Grand CentralNovember 25, 2019
Content targeting company Zefr has signed a 15,000-square-foot, 10-year lease on the 13th floor at 10 Grand Central, announced building owner and manager Marx Realty. The company is relocating from 292 Madison Avenue.
“Zefr is the type of cutting-edge tenant that gravitates towards the authentic and highly designed hospitality-like office space that uniquely defines 10 Grand Central,” said Craig Deitelzweig, president and CEO of Marx Realty. “They instantly fell in love with the warm and inviting nature of the building and they know that no other space would better help them in attracting the best talent in New York.”
The recent completion of a redesigned four-story entry portal, marquee, lobby, lounge, Ivy terrace, and 40-seat conference space was part of the $48 million repositioning of the 35-story Ely Jacques-Kahn designed office tower. In addition, the repositioning included a new façade with a soaring marquee featuring brass fins and oversized walnut doors. Amenities include a well-appointed lounge with ample seating and a café, a conference facility with seating for 40 and The Ivy Terrace, an inviting outdoor space reminiscent of a 1930s era garden party.
Marx Realty has signed 193,000 square feet of new leases since the announcement of the building’s repositioning in mid-2018. During that time, occupancy has increased from 78% to 93%.
JLL’s Cynthia Wasserberger, Sam Seiler, David Kleiner and Carlee Palmer are leading a team handling the leasing for Marx Realty. The building’s asking rents range between $82 and $130 per square foot.
New York owner completes $10.5M renovation of Atlanta’s former Regenstein’s Department StoreDouglas Sams
A $10.5 million modernization of downtown’s former Regenstein’s Department Store into a potential destination for creative class companies is the latest sign of downtown’s “renaissance,” says the project’s owner.
Marx Realty, the New York-based owner, developer and manager of the property, recently finished renovations at 207 Peachtree. The 1920s building features Art Deco design, terracotta barrel-vaulted ceilings, fluted columns, and 18-foot ceilings.
Marx is rebranding the property as The Department Building, paying homage to its former use as Regenstein’s.
Architecture firm ASD | SKY led the redesign.
The project is geared to potential tenants in industries such as tech and advertising. One source of interest may come from out-of-town companies putting a foothold in Atlanta.
Those companies typically rent co-working space as they ramp up their expansion, before signing a long-term lease in a new building.
A potential tenant is in discussions to occupy one floor at 207 Peachtree, said Jeff Bellamy, with Jones Lang LaSalle, who is marketing the property along with JLL’s Claire Ross.
The Department Building features 25,000 square feet of loft office space.
Craig Deitelzweig, president and CEO of Marx Realty, said “The downtown Atlanta neighborhood has been experiencing a renaissance in the last few years. … The office and retail tenants who choose to take space here will attract a new generation of creative office users that will build on the neighborhood’s strong growth.”
The modernization of 207 Peachtree is one of several new projects in the area. Last year, developers started work on a 29-story high-rise with 345 apartments, including 70 affordable units at the nearby Peachtree Center development.
Marx Realty unveils plans for Penthouse Collection at 10 Grand CentralNovember 05, 2019
Manhattan, NY Marx Realty (MNPP) will transform the top five floors at its 10 Grand Central office tower into a suite of penthouse offices. Dubbed The Penthouse Collection, the offices can be configured as 5,000 s/f single-floor leases or combined into a 10,000 s/f duplex space or a 15,000 s/f triplex office. The spaces on floors 32-36 will be reinvented as office spaces designed to attract international fashion brands, financial powerhouses and technology firms.
Having signed over 178,000 s/f of new leases since the announcement of the building’s repositioning less than a year ago, Marx Realty saw the potential in bringing new life to the upper floor spaces considering the views, potential for 20-ft. ceiling heights and outdoor terrace spaces.
“The next logical step after bringing our one-of-a-kind hospitality aesthetic to 10 Grand Central was to provide the ultimate office experience for high-end users,” said Craig Deitelzweig, president and CEO of Marx Realty. “We’ve already attracted top-tier tenants and well-known groups to the building with our hotel-like ambiance, best-in-class service and beautifully designed office spaces. The Penthouse Collection raises the bar even higher with ridiculously luxurious finishes and an experience comparable to a stay at the finest penthouse suite in a luxury hotel.”
The Penthouse Collection experience begins with private elevators from the recently redesigned and relocated lobby at 10 Grand Central, which boasts a uniformed doorman, oversized walnut wood doors and a signature scent that is diffused throughout the building. Each suite will feature rich walnut wood finishes, herringbone hardwood floors and a private bar and café combined with upscale touches reminiscent of the most exclusive members-only clubs.
The upper-most floors – 35 and 36 – will be connected with a grand staircase fashioned in walnut wood and polished stone for a combined total of 10,000 s/f and will offer a 3,500 s/f sky garden terrace on the east side and a separate 2,400 s/f solarium on the west side. Ceiling heights of 20 ft. give way to floor-to-ceiling windows that offer in-your-face views of the Chrysler Building and the surrounding architecture of Midtown East while a library wall adds a literary flair to the space. A fireplace and bar round out the offerings on the 36thfloor. On the 32nd and 33rd floors, Marx Realty will outfit 5,000 s/f, single-floor spaces with the finest finishes in line with the hospitality aesthetic of the building. These floors can be leased individually by separate firms or joined by a staircase to create a duplex office experience for a single user.
“This penthouse experience will be like nothing else in the New York market,” said Deitelzweig. “10 Grand Central and its game-changing hospitality aesthetic is well-known and we’re taking it up a notch with The Penthouse Collection. We’re fielding inquiries on a daily basis from some of the most elite firms in the country.”
The reveal of The Penthouse Collection comes on the heels of Marx Realty’s $48 million repositioning which includes a redesigned and relocated four-story entry portal and marquee and the addition of a seventh-floor lounge, café, terrace, and 40-seat conference space at the 36-story Ely Jacques-Kahn designed office tower. In addition, the repositioning included a new façade with a soaring marquee featuring brass fins. The accents and finishes from the lobby evoke a high-end hotel vibe that continues with a suite of hospitality-styled amenities on the seventh floor. The indoor/outdoor café and lounge boasts a confluence of 7,500 square feet of hospitality-styled amenities including a well-appointed lounge with ample seating and a café, a conference facility seating 40 and The Ivy Terrace, an inviting outdoor space reminiscent of a 1930s era garden party.
The redesign was led by a Marx interior design team and David Burns, principal of Studios Architecture. JLL’s Cynthia Wasserberger, Sam Seiler, David Kleiner and Carlee Palmer are leading a team handling the leasing for Marx Realty.
Marx Realty most recently signed Goldman Sachs-backed Crux Informatics to a 10-year full-floor lease at 10 Grand Central. High-profile tenants also include Dwayne “The Rock” Johnson’s production company, Seven Bucks Productions (as reported by the NYPost.com); insurance giant MassMutual, international news agency Agence France-Presse; UK-based sports private equity firm 23 Capital; asset management firm Everside Capital Partners; and, educational technology company Decoded. They join investment firm Benenson Capital Partners; Dennis Publishing’s The Week; and advertising association powerhouse ANA.
Owners Magazine 2019: Talking With the Top Developers and Owners of NYCBY THE EDITORS | NOVEMBER 5, 2019 9:00 AM
Craig Deitelzweig
President and CEO, Marx Realty
Which commercial lease was your biggest win this year? Although not our largest lease, the roughly 60,000-square-foot lease expansion, extension and relocation by ANA at 10 Grand Central was our most impactful as it freed up the top four floors of the building. These floors are now part of our ridiculously high-end Penthouse Collection, with private outdoor space, direct, in-your-face views of the Chrysler Building and soaring, 20-foot ceilings. We anticipate achieving some of the highest rents in Midtown for this space.
Do you think we’re heading into a downturn? Why or why not? All of our indicators show that the New York City market is as strong as ever and our portfolio has never been busier. Likewise, the commercial real estate markets in cities like Atlanta and D.C. continue to show steady growth.
What do you think the future looks like for WeWork and other coworking operators if the economy slows down? These coworking groups will perform poorly during a recession. They have performed poorly during past recessions and the durational mismatch inherent in their business model persists today. The challenges that I have seen are that they expanded far too fast and along the way they were able to convince some of the market players that having a location in their building was a benefit to the landlord and other tenants. I don’t believe that outsourcing culture and community is ever a good idea, so at Marx we create hospitality-like experiences and dramatic spaces specially tailored for our tenants and all the while reinforcing the building’s unique brand and heritage.
Is New York City losing its shine? Are property investors starting to look elsewhere? New York is one of the strongest and most dynamic office markets in the world and continues to improve with the explosion of technology companies locating and expanding here. New York will remain a prime and stable choice for investors.
How have you adjusted your business plan since the new rent laws were passed? Thankfully, we do not have multifamily assets in New York.
Do the new rent laws present any opportunities for savvy owners? Nothing good will come out of these regulations. The biggest concern to New York today is the increasing burdens that these ever-expanding regulations pose on the local economy.
Is REBNY in need of a revamp? What needs to happen? REBNY continues to do a great job educating the public on the impacts of over-regulation on the economy. We all need to work together to help prevent another Amazon debacle from reoccurring. [It’s] hard to understand how well-paying and “new economy” jobs in Queens (my hometown) were somehow considered a bad thing.
What’s the biggest headache in your job that no one knows about? We have been credited with being the first to truly marry office and hospitality and reinvent the office product. As a result, our buildings have doormen outside; music in our lobbies; a signature scent being diffused through the HVAC system; and a club floor with a lounge, high-end cafe and beautifully landscaped outdoor terraces. Overall, the biggest challenge we address every day is that details matter. We make sure all of our tenants and guests are properly welcomed, so our front-of-house associates undergo rigorous training to ensure that everyone performs the Marx way of treating our tenants. Our goal is to perfect the art of making our tenants feel special at “hello.”
What’s more important: having the best lawyer or having the best accountant? I’m a former Skadden lawyer, so I understand the incredible value a sharp lawyer provides.
Most underrated neighborhood in the city? Midtown East. It is by far the most transportation convenient and offers the most diverse talent pool in the entire city. The restaurants, fitness venues and services available make it a great location for finance, tech, legal and creative firms. In the past, any landlord who owned an office building near Grand Central barely had to lift a finger to be successful. The tenants came to them. Now, with new building stock being built on the west side, many of the buildings in the Midtown East market need to be reimagined. Landlords content with the success of the past will fall further behind while creative owners will continue to thrive. We are actively pursuing acquisitions of these types of assets in Midtown.
If you could pick the Republican and Democratic nominees for President, who would they be? Lyndon Johnson versus Ronald Reagan.
LIGHTNING ROUND:
Favorite book? I love reading biographies of visionaries and industry titans.
Too many to pick just one.
Favorite restaurant? Serendipity 3. We have enjoyed a delicious sundae celebration for every one of my kids’ birthdays.
Favorite vacation spot? We’re heading to Australia this winter and I already know it will be our best vacation!
Favorite TV show? “Succession,” even though I try to raise my kids to be the complete opposite of those kids
Favorite movie? “Scarface.” Queens was a pretty rough place when I was growing up so this reminds me a bit of my childhood.
Favorite sport? Baseball. The Mets are my favorite (and most heartbreaking) team by far. Next year is our year.
Marx making a Grand statement with luxury penthouse officesby REW | October 24, 2019
Marx Realty (MNPP) announced it will transform the top five floors at its 10 Grand Central office tower into a suite of penthouse offices.
Dubbed The Penthouse Collection, the offices can be configured as 5,000 s/f single-floor leases or combined into a 10,000 s/f duplex space or a 15,000 s/f triplex office.
The spaces on floors 32-36 will be reinvented as “uber-luxe office spaces” designed to attract international fashion brands, financial powerhouses and technology firms.
Having signed over 178,000 s/f of new leases since the announcement of the building’s repositioning less than a year ago, Marx Realty CEO Craig Deitelzweig said the company saw the potential to bring new life to the upper floor spaces
“The next logical step after bringing our one-of-a-kind hospitality aesthetic to 10 Grand Central was to provide the ultimate office experience for high-end users,” said Deitelzweig.
The Penthouse Collection offers private elevators from the recently redesigned lobby at 10 Grand Central. Each suite will feature walnut wood finishes, herringbone hardwood floors and a private bar and café.
The upper-most floors – 35 and 36 – will be connected with a grand staircase fashioned in walnut wood and polished stone for a combined total of 10,000 s/f of space and will offer a 3,500 s/f sky garden terrace on the east side and a separate 2,400 s/f solarium on the west side.
Ceiling heights are 20 feet and floor-to-ceiling windows offer birds eye views of the Chrysler Building.
A fireplace and bar round out the offerings on the 36th floor. On the 32nd and 33rd floors, Marx Realty will outfit 5,000 s/f single-floor spaces that can be leased individually by separate firms or joined by a staircase to create a duplex office experience for a single user.
“This penthouse experience will be like nothing else in the New York market,” added Deitelzweig. “10 Grand Central and its game-changing hospitality aesthetic is well-known and we’re taking it up a notch with The Penthouse Collection. We’re fielding inquiries on a daily basis from some of the most elite firms in the country.”
Marx Realty has spent $48 million repositioning the entire property to include a four-story entry, seventh-floor lounge, café, terrace, and 40-seat conference space.
The redesign was led by a Marx interior design team and David Burns, principal of Studios Architecture.
JLL’s Cynthia Wasserberger, Sam Seiler, David Kleiner and Carlee Palmer are leading a team handling the leasing. The asking rents for the penthouses is $130 psf.