Lease of the Week
It’s not uncommon to hear Manhattan’s real estate market characterized as sophisticated or complex.
Not every day, however, does a requirement as straightforward as Dentsu McGarryBowen’s uncork such an elaborate and interconnected series of transactions as it did at the Starrett-Lehigh Building.
A longtime tenant in the 2.3-million-square-foot building and one of the property’s largest users, the advertising firm needed to expand. But there was a small problem: Despite its size, the building—an artsy, far West Side location popular among creative tenants—had virtually no available space.
A year into owning the Starrett-Lehigh Building, RXR Realty is making what at first appeared a dicey gamble into an investment that looks closer to a sure thing.
RXR, led by its chief executive Scott Rechler, acquired the 2.3 million-square-foot far West Side office building last year for a whopping $900 million, a purchase price that equated to almost $400 per square foot. Though buildings in Midtown have traded for double that or more on a per square foot basis in recent months, the sheer magnitude of the investment turned heads as a jumbo-sized commitment in a neighborhood that many brokers and tenants still consider off the beaten path.