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February 14, 2024 | By: Emily Fu
Marx Realty has completed the transformation of 819 7th St. NW in Washington, D.C., now called The Grogan. The 21,000-square-foot building, acquired in 2018, the property situated in D.C.’s Chinatown neighborhood. The penthouse’s mezzanine offers a café and terrace with city views.
“We are excited to capture the history of The Grogan Building and create a distinctive office space that exudes a boutique members-only, club-like ambiance,” said Craig Deitelzweig, CEO of Marx Realty. “We pioneered the now widely-recognized hospitality-infused aesthetic and essentially set a new benchmark for the workplace experience while creating a completely differentiated asset class in the office sector.”
In addition to its holdings in New York and Atlanta, Marx Realty currently owns three office assets in Washington, D.C. – The Grogan at 819 7th St. NW, The Herald, located at 1307 New York Ave NW, and One Glover, located at 2121 Wisconsin Ave. NW, with its recently completed top-to-bottom repositioning.
Marx Realty Delivers Renovated Grogan Office Building in D.C.’s East EndFebruary 13, 2024
WASHINGTON, D.C. — Marx Realty has delivered The Grogan, a repositioned office building located at 819 7th St. NW in Washington, D.C.’s East End. The New York City-based developer purchased the 21,000-square-foot property in 2018. The renovated asset includes a new façade, canopy and entryways, as well as an upgraded lobby and mezzanine space of the penthouse that includes a café, delineated seating and access to a private terrace.
Built in 1891, The Grogan features 12- to 15-foot wood ceilings, exposed brick, wood columns and arched windows, all of which have Marx Realty has restored.
Deals of the Day: Feb. 14February 14, 2024
Leases
Private equity firm extends Plaza District deal
Address: 545 Madison Ave., Manhattan
Landlord: Marx Realty
Tenant: TruArc Partners
Lease size: 10,000 square feet
Lease length: Seven years
Asking rent: $86 to $135 per square foot
Asset type: Office
Brokers: JLL’s Evan Margolin and Ben Levy represented the tenant. A Cushman & Wakefield team led by Tara Stacom represented the landlord.
February 6, 2024
TOP LEASES
Marx Realty announced it signed a total of 24K SF of leases at 10 Grand Central. The Completed Life Initiative took 8K SF on the 10th floor for 10 years, with representation from Lantern’s Matthew Seigel and Jessica Adler. On the same floor, Rebalance Management and Bancorp Bank took 3K SF apiece, with JLL’s Scott Ansel repping Bancorp and Spaces Commercial Real Estate’s Jack Cohe repping Rebalance. Freedman Normand Friedland took 5K SF on the ninth floor, with representation from CBRE’s David Kleinhandler. On the 33rd floor, GSTQ renewed its 5K SF for three years, with representation from Colliers’ Michael Joseph and Aidan Campbell. JLL’s Mitchell Konsker, Kyle Young, Carlee Palmer, Simon Landmann and Thomas Schwartz handle leasing for Marx Realty. Asking rents ranged from $68 to $108 per SF.
Marx Realty adds 4 tenants at New York City office tower 10 Grand CentralFebruary 1, 2024
Four new leases have been signed at New York City office building 10 Grand Central in Midtown.
- The Completed Life Initiative signed a 10-year lease for around 7,700 square feet on the 10th floor. Lantern Real Estate Advisors’ Matthew Seigel and Jessica Adler represented the health consultant on the deal.
- Law firm Freedman Normand Friedland signed a 5,400-square-foot, 10-year lease on the ninth floor. CBRE’s David Kleinhandler represented the company on the deal.
- Rebalance Management inked a seven-year lease for approximately 2,800-square feet on the 10th floor for its first New York City office. Spaces Commercial Real Estate’s Jack Cohen represented in the investor on the deal.
- Bancorp Bank signed a 10-year lease for an approximately 2,800-square-foot space on the 10th floor. JLL’s Scott Ansel represented the bank on the deal.
JLL’s Mitchell Konsker, Kyle Young, Carlee Palmer, Simon Landmann and Thomas Swartz represented the landlord, Marx Realty, on all of the deals.
The deals “not only affirm the success of our repositioning strategy, but also highlight a notable resurgence, with building activity now exceeding pre-Covid levels,” Marx Realty’s President and CEO Craig Deitelzweig said in a statement.
Asking rents in the building range from $68 to $108 per square foot.
With these signings, the building is now 90% leased.
Notable tenants at the building include Dwayne Johnson’s production company Seven Bucks Productions, insurance company MassMutual and international news agency Agence France-Presse.
Since 2023, more than 94,000 square feet of office and ground-floor retail space have been leased at 10 Grand Central.
Marx Realty Adds 24K-SF Leases at 10 Grand Central“The past 12 months have been the strongest in leasing for the building since it first opened in 1932,” Deitelzweig said in the statement.
February 1, 2024
Marx Realty has signed new leases and renewals totaling 23,855 square feet at 10 Grand Central in Midtown.
The signings include a 7,719-square-foot, 10-year lease for The Completed Life Initiative, a 5,400-square-foot, 10-year lease for Freedman Normand Friedland, a 5,212-square-foot, 3-year lease renewal for GSTQ, a 2,762-square-foot, 7-year lease for Rebalance Management, and a 2,762-square-foot, 10-year lease for Bancorp Bank. The property underwent a $45 million repositioning in 2019.
“10 Grand Central continues to thrive and reap the benefits of its pioneering hospitality-inspired repositioning strategy,” said Craig Deitelzweig, president and CEO of Marx Realty. “The past twelve months have been the strongest in leasing for the building since it first opened in 1932.”
February 1, 2024
Leases
Patient advocacy group takes space by Grand Central
Address: 10 Grand Central, Manhattan
Landlord: Marx Realty
Tenant: The Completed Life Initiative
Lease size: 7,719 square feet
Lease length: 10 years
Asking rent: $68 to $108 per square foot
Asset type: Office
Brokers: Lantern’s Matthew Seigel and Jessica Adler represented the tenant. A JLL team led by Mitchell Konsker, Kyle Young, Carlee Palmer, Simon Landmann and Thomas Schwartz represented the landlord.
The nonprofit signs the largest of five leases totaling 23,855 SF at the building
A nonprofit that advocates for the good death closed a chapter in Brooklyn and headed to Manhattan.
The Completed Life Initiative signed a 10-year lease for 7,719 square feet on the 10th floor of 10 Grand Central in Midtown, landlord Marx Realty announced.
Asking rents on the 10th floor of the 35-story building between Lexington and Third avenues, which has an alternative address of 155 East 44th Street, range from $74 to $84 per square foot, according to a spokesperson for Marx.
Completed Life was founded in 2019 by Faith Sommerfield, a lifelong New Yorker and founding member of the right-to-die organization The Hemlock Society who died in 2022. It currently has offices on the first through third floors of 175 Pearl Street in Dumbo, Brooklyn, according to its website. It’s unclear if the organization will expand its footprint with the move to Manhattan.
Lantern Real Estate Advisors + Partners’ Matthew Seigel and Jessica Adlerarranged the deal for Completed Life, while Marx Realty was represented by JLL (JLL)’s Mitchell Konsker, Kyle Young, Carlee Palmer, Simon Landmann and Thomas Swartz.
Seigel, Adler and a spokesperson for JLL did not immediately respond to requests for comment.
Completed Life’s deal was the largest of five leases Marx signed in January at the Beaux Arts office building near Grand Central Terminal.
In the other deals, Freeman Normand Friedland took 5,400 square feet on the ninth floor, menswear label GSTQ grabbed 5,212 square feet on the 33rd floor, French investment firm Rebalance Management signed on for 2,762 square feet on the 10th floor, and Bancorp Bank inked a deal for 2,762 square feet also on the 10th floor, according to Marx.
Marx President and CEO Craig Deitelzweig said in a statement that leasing activity at the recently renovated 430,000-square-foot building over the past year has been stronger than any other time since it was built nearly a century ago.
“The latest additions to 10 Grand Central’s already exceptional roster will further elevate the building, solidifying its status as one of Midtown’s most captivating and dynamic office towers,” Deitelzweig said.
By Lois Weiss | Jan. 18, 2024
Rolls-Royce is taking over the penthouse of 50 Ninth Ave.
Despite a lethargic 2023, office leasing got its mojo back in the fourth quarter when the year’s largest deals were completed.
Law firms led the action with blockbuster leases inked after Labor Day.
Davis Polk renewed and expanded its lease to 630,000 square feet at RXR’s 450 Lexington Ave. Paul Weiss will relocate from 1285 Sixth and expand to 765,000 square feet at Fisher Bros.’s 1345 Sixth, which has $120 million in new amenities. Quinn Emanuel is leaving 51 Madison Ave. for 132,000 square feet at 295 Fifth Ave., which received a $350 million redevelopment. Its spin-off, Selendy Gay Elsberg, also expanded and signed a direct lease for 101,000 square feet at Vornado’s 1290 Sixth Ave. King & Spalding will join them in 175,000 square feet in a move from nearby 1185 Sixth Ave.
Regardless of the industry, all tenants are looking for the same things. “Location and access to transportation has moved to the top of the criteria list,” said Chris Corrinet of CBRE.
Law firm Davis Polk expanded its lease to 630,000 square feet at RXR’s 450 Lexington Ave.
That’s why Park Avenue, north of 46th Street and around Grand Central are “bright spots in a moribund area,” added David Hoffman of Cushman & Wakefield. An example: MetLife renewed and expanded to 400,000 at its namesake tower at 200 Park Ave., which sits on top of Grand Central and now serves LIRR riders. However, Class A buildings outside of the new sweet spots still have large vacancies. RXR and SL Green’s 5 Times Square has 750,000 square feet available with gorgeous amenities and LED signage.
Commuters to Hudson Yards can hop on the 7 train, making it easy for Wells Fargo employees to relocate from 150 E. 42nd St. to its newly purchased 300,000 square feet at 20 Hudson — where it already has 500,000 square feet at 30 Hudson Yards.
Fresh spaces are equally important to tenants. That’s why Hudson Yards, Manhattan West, the Farley Building over the new Moynihan Station, Morgan North and the area around Penn Station are all completely reinvented.
5 Times Square has yet to move 750,000 square feet of office space.
On Seventh Avenue, Vornado’s Penn 2 is now complete and West 33rd Street will soon become a plaza.“You can feel that the area will be transformed and the folks from Vornado have done a good job of changing people’s perceptions,” said Mark Weiss of Cushman & Wakefield, whose colleagues will now lead leasing for Penn 2.
More leasing action is coming from companies facing lease expirations. IBM and Franklin Templeton, for instance, will move to SL Green’s reinvented One Madison in Nomad.
LinkedIn recently renewed and expanded at the Empire State Building to 526,000 square feet.
Anthony Malkin of Empire State Realty Trust said deals like that are thanks to the building’s campus-like amenities, improved energy efficiency and indoor air quality. “If you don’t go to a brand-new, glass-wall building and look for the next tier, you come to us,” he said.
Pricing for such top-tier trophy properties, especially in the Plaza District, is hitting $200 to $300 per square foot — think One Vanderbilt, 550 Madison, 767 Fifth, 425 Park and 9 W. 57th St. In contrast, buildings without amenities are struggling for tenants at anywhere from $30 to $80 per foot.
Office and amenity design continues to be influenced by hospitality, said Gensler architect Robert Fuller.
Baccarat is moving to a penthouse headquarters and showroom with a terrace at Marx Realty’s hospitality-infused 545 Madison Ave. — and signed a branding deal. The building’s lounge will have a Baccarat chandelier and use its barware.
“The Rivian house car will get the Baccarat scent in the car,” said Craig Deitelzweig of Marx Realty.
Marx will raise rents there and at 10 Grand Central Place where a new floor of amenities will include a 150- to 200-seat town hall space, a screening room, a lounge, a fireplace and even a spot for podcasting.
“Is it worth it? Yes, it is,” Deitelzweig said. “It pays for itself.”
More amenities are also coming to 9 W. 57th St., where owner Stefan Soloviev is adding $45 million in improvements. He’s building a 27th-floor amenity center with dining overlooking Central Park and space for 150 people to meet. The lower level has a full gym with a cold plunge pool and a hot pool. “The 150-person meeting area was a suggestion by a tenant,” Soloviev said. “I am listening to what tenants want.”
Jeff Peck of Savills, who has clients seeking 20,000 to 150,000 square feet, calls it the “flight to excitement.”
“If you can make something lackluster into something ‘wow,’ we can lease it all day long,” echoed Deitelzweig.
To drive excitement in the Meatpacking District, Rolls-Royce will create a VIP experience center in a penthouse with a wraparound terrace at the new office tower and historic retail project at 50 Ninth Ave. being developed by Tavros (with an asking rent over $200 per foot).“People want to be in the most dynamic neighborhoods and want to pay a premium to be there and in buildings that have amenities for the employees,” said Nicholas Silvers of Tavros.
How Shopping Mall Icons Are Ditching Their Dying StoresHot Topic, Journey’s, Victoria’s Secret and others are exploring alternative store formats
January 12, 2024 | By Sasha Jones
Two in five Americans live near two or more dead malls, and retailers hope to save themselves with different store openings Joe Raedle/Getty Images
Stores have always benefited from the mall’s wormhole effect on shoppers — come to buy just one thing, stay to spend money at Hot Topic, Bath and Body Works and Forever 21. And just try to avoid temptation from Auntie Anne’s.
But as foot traffic slowly dies, the retailers that define a classic trip to the mall are looking for ways to outlive their homes. It’s led them to explore new real estate formats.
“Many of these brands that are operating in enclosed malls are really good retailers,” said David Hinkle, principal of The Outlet Resource Group, who advises shopping center developers. “They may not be the primary reasons someone says, ‘Hey, let’s go shop today,’ but when the customer gets there, the stores are typically well merchandised, visually fantastic and they do a lot of volume.”
Shopping center vacancy rates ended last year at an all-time low, according to a report by commercial brokerage Cushman and Wakefield. Though malls saw brighter days compared to the doom days of the pandemic, foot traffic is still 13% below 2019 levels.
And that’s just for the malls that are still operational. Two in five Americans live near two or more dead malls — defined as having a high vacancy rate, low traffic level or completely abandoned — according to a report by real estate consultant group IPX1031.
Among the retailers fleeing malls is Journey’s, known for selling shoes like Heelys and Vans. At the end of 2023, it shut down 100 mall stores, replacing them with 25 off-mall leases, the company said in its second quarter earnings call. Those new locations will be able to carry a larger assortment of adult and kids shoes and accessories.
One of those is in New York’s Cross County Center.
The newly opened Journey’s at Cross County Center Marx Realty
Craig Deitelzweig, CEO of Marx Realty, which owns the center, said that the mall environment has pushed shoppers away, not the retailers. In new spaces, the brands are able to experiment with layout and design, he said.
The landlord added that hosting events and activities on the lawns outside the shops brings customers into the center for longer.
“The ability to [entertain] kids and families — that’s what malls used to be like,” Deitelzweig said. “Now people don’t want to be stuck, for lack of a better word, in that environment.”
The giant 100-store open-air shopping center is also home to mall staple Cinnabon. However, instead of being secluded to mall kiosks, the bakery operates in a standalone store with seating.
In a move of self-awareness, both Journey’s and Hot Topic — remembered as a dimly lit store blasting 2000’s pop punk, always equipped with an emo, teenaged cashier — have launched collaborations with online resale platform thredUp to sell their, now nostalgic, 2000’s band tees.
Hot Topic has also popped up in outlet malls, which have appealed to inflation-pressured shoppers in recent years.
For many companies, the plan to leave malls behind has been in the works for years.
By the end of this year, Gap and Banana Republic will complete a real estate restructuring that will result in 80% of its stores being outside of malls, according to previous investor reports.
Macy’s similarly plans to triple its fleet of small-format stores in 2024 and 2025 — an initiative that began in 2020.
In August, Victoria’s Secret CEO Martin Waters outlined the company’s three strategies moving forward: opening smaller stores, its “Store of the Future” modernizes its layout and embracing digital sales.
“If you think about new competitors that have come into the market in recent years, they tend to be digitally-native players,” Waters told investors. “We’re doing okay in digital.”
In moving outside of the mall, brands will find out whether they still resonate with shoppers or if it’s time to admit defeat, The Outlet Resource Group’s Hinkle said.
“At the end of the day, I always say the consumer votes with a checkbook. These brands who migrate their way into the outlet sector, they have to be good,” Hinkle said. “If they don’t perform they’re not going to stay there nor will the landlord want them.”