Proving that hedge funds may indeed be the new investment banks (as Tom Wolfe told The Observer earlier this month), new hedge fund Dabroes Management has signed for 12,202 square feet on the 24th floor of 1095 Avenue of the Americas, the former Equity Office Properties tower that’s undergone $275 million in recent renovations, including a green curtainwall.
The rent’s $135 a square foot, according to Dabroes’ agent on the deal, CB Richard Ellis. That’s the sort of rent expected for Class A space in Manhattan.
One of the many question marks spawned by the financial crisis, of course, was whether commercial landlords will be able to continue to command such high rents. After all, the traditional big leasors of higher-end office space are big banks and the big law firms that service them. What to do as these industries shed jobs? Rent to hedge funds, goes one popular strain of logic.
But, as Mr. Wolfe noted, hedge funds are inherently small operations: "Look at the number of employees. Lehman? 28,000! And a Greenwich hedge fund can be handling the same amount of money with 20 employees."
Does Manhattan host enough brawny hedge funds to pick up the slack, or will landlords look elsewhere over time for tenants? To, say, advertising?
CBRE’s Zach Freeman, Robert Alexander and Rob Stillman handled the 1095 lease for Dabroes. And Cushman & Wakefield’s Andy Sachs and William Levitsky represented the landlord.