“When we went to see the space, it helped that the agent said, ‘I know what you guys are. I just used you!’” the tenant’s broker, Elliot Warren of The Kaufman Organization, told The Observer. Village Vines then successfully landed its first 2,500-square-foot permanent digs near Union Square for five years at 37 West 17th Street.

The company is less than a year old, so for the less technologically inclined, he explained the concept thusly: Diners pay a $10 reservation fee to receive a 30 percent discount when booking through the Village Vines website. He added, “You have one guy paying $1,000 a bill for dinner at Le Cirque and another guy is paying $700.”

For those not accustomed to running up four-figure restaurant tabs, the asking rent was a modest $32 a square foot for an office a few blocks from the park and amidst Union Square’s bustling restaurant scene. “Union Square was important to us … but there are very few office spaces in that neighborhood," Mr. Warren said.

The building is also home to Sushi Samba’s corporate office, Max Brenner and Basta Pasta, so we know where we’ll be freeloading our next meal.

Jake Mansher of the Moinian Group represented the landlord.

lkusisto@observer.com

Indeed, for a broker who focuses squarely on Westchester and Fairfield counties, the 25-year commercial real estate pro's thrice-weekly, 45-minute commutes into midtown are de rigueur--even during the slump. Hardly a surprise to New York's real estate community, the tri-state region has always been an interconnected knot of corporate hubs and satellite offices, fastened together like so many train stations along Metro North, New Jersey Transit or the LIRR.

"Fairfield and Westchester are both all about the executive's geography--it's where these guys live and it's where they want their offices," said Mr. Kiley, 46, a managing director with Grubb & Ellis whose team joined the company in September. "So it's like a pyramid. If the executives live in New Canaan or even Greenwich, their satellite offices are going to be in Fairfield. And it's all driven by New York's metro market."

As New York City's office leasing continues to see modest upticks in net effective rents, so too are landlords' concessions starting to soften. In Westchester, where PepsiCo inked a 540,000-square-foot renewal at its nine-story headquarters, leasing has surged in the first quarter of 2011 to its highest levels since 2005. Demand for Class B space as some tenants look to downgrade, meanwhile, has real estate observers predicting higher rental rates in the very near future.

Still, in Fairfield, leasing velocity has remained sluggish, with deal volume decreasing sharply, by 39 percent, in the first quarter of 2011 compared to the same time last year. The 586,555 feet of transactions recorded for the quarter is the lowest since early 2009.

It's those market idiosyncrasies that keep Mr. Kiley and colleagues Gerard Smith, Gregory Shaughnessy, Andrew Carney and Patrick Bisceglia running back and forth across Manhattan and Westchester and Fairfield counties.

"You know what happened? In August of 2007 somebody shut off the clicker and took the battery out of it," said Mr. Kiley of the Fairfield County market. "And the TV didn't go back on until six months ago. It was literally frozen."

Since the screen jolted back into focus, however, his team, which specializes in investment sales and leasing, has been tasked with an array of searches.

In Hartford and New Haven County, Mr. Kiley and his group have been tapped to seek in excess of 100,000 feet of space for tenants while also marketing the sale of office and multifamily assets across Fairfield. Additionally, office leasing at 30 Oak Street began earlier this year. In New York, meanwhile, Mr. Kiley is working on behalf of cutlery company Zwilling J.A. Henckels to dispose of its North American assembly facility in Hawthorne while also managing the site selection for the company's new home somewhere between White Plains and Hawthorne along I-287.

All the while, Mr. Kiley has overseen a decades' worth of deals for GE Capital, including leasing and disposition of an asset at 100 Prospect Street in 2006, a full repositioning of space at 600 Summer Street, and the sale of its huge Harrison Court Complex in Westchester back in 2001. More deals are likely soon to come, he said.

"In the first quarter of 2010, we were still frozen, but we were out of the ice chest," Mr. Kiley said. "By the second quarter we were actually noticing that we had a lot of activity. And, now, the due diligence is starting to pay off. We slung-shot right into the first quarter of 2011 as if it was September 2007."

 Speaking of 2007--a moment in time typically referred to as the peak of the real estate market--Mr. Kiley was still presiding over The Alliance Group, the successful boutique commercial real estate firm he founded back in 2002.

When the market crashed, however, he and his group began shopping the firm around to larger companies in an effort to gain a larger platform. In 2010, he rolled the group into Grubb. "When you're in the suburbs you don't have 350 million square feet of office space--we have around 10 million of good Class A space," said Mr. Kiley, a Boston University graduate who is also a licensed real estate broker in Massachusetts. "So our strengths have always been really project-oriented."

Born to a large Irish-Italian family in Greenwich and raised in Shelton, Conn., Mr. Kiley got his earliest whiff of the real estate industry from his grandfather, who ran a road construction company. As he became older, the ingénue joined the business amidst the mid-1990s building boom.

"So, eight or nine years old, I'm sitting in some guy's lap, pulling all the levers, pushing all the buttons, trying to dig a hole and probably making a mess," Mr. Kiley recalled last month. "And there was something about the construction business that I always wanted to be a part of. But my grandfather, being the guy he was, always tried pushing his son and me away from the business, but all he really did was suck us all in."

After working a backhoe at Governors Island, Mr. Kiley joined The Galbreath Company, where he worked until 1997, when LaSalle Partners acquired the firm. Not one to procrastinate, the broker immediately went on to co-launch Antares Real Estate Services with a former Galbreath employee.

The father of three grown children--among them an aspiring actor and a musician, neither with designs on the real estate world--Mr. Kiley lives with his wife in Stamford. An avid golfer and fisherman, he spends many of his off hours in Long Island Sound, angling for striped bass early in the morning.

"I like playing golf, but I'd rather be fishing," Mr. Kiley said."Any morning at 4:30, when the water's like glass."

jsederstrom@observer.com

The Southern painter-cum-interior designer has taken 22,500 square feet for 10 years at 509 West 34th Street, past 10th Avenue. The four-story industrial building over a parking garage has a few columns and windows on three sides, offering the perfect canvas for his famed Gothic interior styling.

"Some people are great in an industrial space," said Carri Lyon of Cushman & Wakefield, who represented the tenant. "He can transform any space," she said, citing his work on an unremarkable 25-year-old office installation on 10th Avenue, formerly "one of the most horrible spaces in New York City."  

Not so of this loft space in a Sherwood Equities building, which was occupied by a prop house. "He works on large canvases and he has a lot of furniture. He needed more space," Ms. Lyon said. "This just came up. It was serendipitous." 

Mr. Slonem will relocate from 545 West 45th Street, as it seems that the far West Side is being increasingly won by creative tenants. Just downstairs from Mr. Slonem's new space, another artist is opening a 22,500-square-foot studio. 

lkusisto@observer.com 

Update: We should note, that while Mr. Slonem's unparalleled eye is much in demand, his decorating services are not currently for hire. 

The little blue bird has been perching in a spartan temporary New York City space since September, searching for the perfect spot for its first New York City headquarters. Now The Observer has learned that it plans to sublease Facebook's former digs at 340 Madison Avenue, according to a source with knowledge of the deal.

Facebook first leased 11,000 square feet on the sixth floor of the glass birthday cake-shaped building, wherein the Office of the Comptroller of the Currency was also housed, in 2009. It fled recently for some similarly corporate two-floor digs just down the street at 335 Madison, where it could expand to as much as 150,000 feet.

The Grand Central area, a hub of finance wonks and high-end insurance law firms, is far from the lofty spaces and hip organic sandwich joints techies have long preferred. But with the world's two most powerful social media companies potentially just blocks from one another, for better or for worse, it seems only a matter of seconds before the classy office strip is dubbed Silicon Avenue (there, done). The recent deals also place both companies near the once throbbing heart of the advertising industry so lionized by Mad Men and so slowly being supplanted by tweets and friendings.

The deal is said to be a few weeks away. For now, Twitter and its broker, Clayton Kline of Jones Lang LaSalle, declined to comment. Scott Rechler's Long Island-based RXR Realty, which purchased the building for $570 million in the spring as its first Manhattan investment, also declined to comment.

lkusisto@observer.com

The Christian liberal arts college currently houses its administrative offices and classroom space in 50,000 square feet on the concourse and lower levels of the iconic tower, controlled by Anthony Malkin's W&H Properties, but their lease expires in 2012, a source with knowledge of the deal told The Observer. "From a branding and a building recognition standpoint," said the source, "they love being in the Empire State building."

Negotiations for the renewal and expansion are "moving slowly" one source told The Observer and another called them "preliminary," but the deal could be wrapped up by the summer. One person said the negotiations have moved slowly while the landlord focused on the huge Li & Fung deal and also possibly on putting an Equinox gym on the lower levels. The latter deal was apparently killed.

Even without the gym, the expansion could prove a challenge: Floors in the building are around 60,000 square feet each, but other retailers, such as Bank of America and Heartland Brewery, are eating up some of the lower-level space with staircases to the basement.

King's College, which was founded in New Jersey in 1938 but moved to New York City in 1999, wants to stay at the famed address—which if nothing else makes it unlikely freshmen will get lost. "What's great," said one source, "is the Empire State Building is truly back on the map as being a desired place to do business after so many years of being passed over by the marketplace because it was seen as a neglected building."

UPDATE: Cushman and Wakefield is leading the assigment representing King's.

lkusisto@observer.com

The social media marketing and branded content agency has taken 40,000 square feet at 40 West 23^rd Street, which also houses Home Depot's Chelsea store. We should clarify they did some work for MySpace and Fox a few years ago, and also represent such biggies as Neutrogena, McDonald's and Colgate-Palmolive,

They were previously headquartered in 6,000 square feet in two buildings at 276 and 298 Fifth Avenue, near the Empire State Building. In the last eight months they've ramped up from 12 to 120 employees, Seth Berk, the company's vice president of business development, told The Observer. Needless to say, they were a bit cramped.

They looked for space in Soho, midtown and their existing neighborhood. "We saw a lot of availability in the corporate-type office spaces. We wanted an open loft that could allow for true collaboration," he said, hitting all the current buzzwords. "I guess it's the Bloomberg model."

They came upon space vacated by Marc Ecko, which The Observer reported last week is opening a new showroom and office on the far West Side.

Big Fuel, founded by former Viacom producer Avi Savar in 2004, currently has 125 employees and the company has experienced "stratospheric growth," expecting to hit 170 employees by the end of the year. If only MySpace could say the same thing.

lkusisto@observer.com

Mr. Meyerson, who helped broker 2010's largest lease for tenant Société Générale, was not alone in eyeing the recovery in the office-leasing market and feeling not relief, but concern. Unlike 2009, when landlords and tenants circled each other warily, shaken by the past year and not knowing what the future could hold, 2010 belonged to the bold.

"All the companies in 2009 needed all the cash they could possibly hoard," Mr. Meyerson said. In 2010, "the storm was settling and ... tenants were more opportunistic."

This past year, the dam broke, the circling stopped. Tenants jumped to lock in cheap rents and generous concessions, in anticipation of a tightening office-leasing market driven by a recovering local economy.

SLIDESHOW: The Top 20 Leases of 2010

While in 2009 the top leases were dominated by renewals, in 2010 over half of the top 20 leases were new ones. And while none of this year's leases could top law firm Paul Weiss' 540,000-square-foot lease in 2009, activity on the beefier end was significantly more robust. Six deals were signed in 2010 of more than 300,000 square feet each, as opposed to only two in 2009.

Overall, more square feet of space was leased in 2010 than in any year since 2006. Activity rose 61.4 percent annually, in fact, according to Cushman & Wakefield's fourth-quarter Manhattan office report. But of the top 10 leases, seven of the deals were signed in the first half of 2010, when the market was weakest, suggesting that while activity was up, taking rents were not.

In a more encouraging sign for brokers, the deals were more or less evenly spread across industries. In 2009, law firms dominated from the top of the list down to No. 19. In 2010, financial services firms were back, with the Société Générale, Deloitte and Allianz Global leases; media held its own with the CBS and Meredith leases; and there was a smattering of retailers, with Avon and Tiffany among those securing corporate headquarters. In perhaps the most striking addition, three of the top 20 leases in 2010 were by nonprofits, government entities and unions, confirming the trend everyone's been whispering about.

Still, will the robust level of activity continue as landlords look to raise rents and scale back on concessions? Will conditions keep getting better and better, and therefore worse and worse for tenants?

In a recent briefing to journalists, Joe Harbert, Cushman & Wakefield's regional COO, said if unemployment drops more sharply, "we could see a little flattening" of office-leasing activity in 2011.

Brokers interviewed by The Commercial Observer said, of course, they anticipate the market will tighten yet more in 2011, making it tougher on tenants and more beneficial for landlords.

A few notes about the list. It was culled using statistics from brokerage Cassidy Turley and database CoStar, and from The Commercial Observer's own reporting over the past 12 months. Also, it reflects leases that were closed in calendar year 2010.

lkusisto@observer.com

• Someone at the Securities and Exchange Commission had the bright idea to stop targeting specific insider trades and instead try to bring down entire communities of Wall Street lawbreakers. This notion has been at play in last year's massive Galleon case and also yesterday's government raids on three big hedge funds. [WSJ]
• There have been no formal allegations against Steven A. Cohen's giant SAC Capital hedge fund. The FBI does, however, seem pretty interested in people who used to work for Cohen. [Bloomberg]
• The Federal Reserve is trying to implement policy without being too political. This is proving difficult. [NYT]
• Richard Bernstein, a guy who used to say the economy was doomed to collapse, is now saying the economy is stronger than people think. Funny how it switches like that. [AP]
• Also, commercial real estate prices have been rising, which is nice. [FT]

mtaylor [at] observer.com | @mbrookstaylor

The controversy surrounding the "Ground Zero mosque" is driving away some Middle-Eastern investors from New York real estate, The Real Deal reports. The article recounts a recent apartment deal with a Saudi investor that fell through and quotes experts who say Middle-Eastern investors have plenty of reason to flee, even if they have long preferred New York real estate because of the legal protections and freedom. 

The Real Estate desk flagged the danger a couple of months ago, quoting former Pakistani ambassador Akbar Ahmed: “I think the genie is out of the bottle,” said Mr. Ahmed when asked if he thought the damage done to the Muslim world’s perceptions of America could be walked back. “Because it is not just about one mosque, and it is not just now.”

Of course, it's early to tell if this unease will actually translate into fewer deals, and brokers are adamant that it won't. 

But consider that Middle Easterners did stop investing in U.S. real estate due to rising intolerance after 9/11. Moreover, it's worth noting that wealthy Middle-Eastern oil tycoons aren't the only ones turned off by perceived intolerance. Investment by Europeans--who plunk down the most money in New York real estate--also dropped off after 9/11 and the subsequent Iraq war. 

New York recently shot ahead of London as the top place for foreign real estate investment. Not coincidentally, that corresponded with the growing perception that the U.S. is the most "stable" and "secure" place to invest. It might take more than the mosque controversy to erode that, but we do also have a national debt the size of the Atlantic and an election that, whichever way it falls, will likely only fuel the fires of intolerance in the country. 

Of course, there's a good chance that even if Middle Easterners and Europeans flee, Chinese investors won't be turned off by a mere human rights spat.

lkusisto@observer.com

"International brand-name companies appreciate the recognition and cachet of the Empire State Building," Mr. Posniak said. "The transaction with Air China is another example of a perfect match between a prestigious company and the World's Most Famous Office Building."

The airline moved into a "pre-built suite," which Mr. Posniak argued was a sign that "pre-builts are no no longer the domain of small companies." Perhaps business being what it is these days, who can afford anything more?

The Real Estate Desk is waiting to hear whether it was the building's profile (literal or figurative), recent "green" renovations, or feng shui that sealed the deal.

mchaban [at] observer.com / @mc_nyo