Tribeca Investment Group, PGIM Real Estate and Meadow Partners Enter into New Ground Lease at the Textile Building in Manhattan
NEW YORK--(BUSINESS WIRE)--Oct 23, 2019--
A newly-formed joint venture among Tribeca Investment Group and funds managed by PGIM Real Estate and Meadow Partners today announced they have entered into a new 99-year ground lease at 295 Fifth Avenue, a 17-floor, 700,000-square-foot property occupying the full block along Fifth Avenue between East 30 th and East 31 st streets in Midtown South. The joint venture plans to commence a nearly $300 million repositioning program that will transform the building into a Class A office tower, capitalizing on the strong demand for large floor plates in the area’s tight office market.
“As the supply of large-block office space across the city has become increasingly constrained, opportunities to acquire properties of this size and quality are rare,” said Elliott Ingerman, Co-Founder of Tribeca Investment Group, a private real estate investment firm specializing in the acquisition, development and management of commercial and residential real estate properties in Manhattan. “In evaluating a variety of opportunities at this stage in the cycle, we recognized untapped potential to capitalize on the strong demand for this type of space – especially among growing finance and technology companies – by delivering a differentiated product with large, flexible floor plates in excess of 40,000 square feet and ceiling heights ranging up to 16 feet. We’re excited to partner with two blue-chip institutions in PGIM and Meadow to execute on our well-conceived business plan.”
295 Fifth Avenue is located in one of the most active office markets in Manhattan. After a record year in 2018 for both leasing activity and asking rents, Midtown South recently exceeded Midtown as the priciest office market in the city, according to CBRE. Demand and rental growth are being driven in large part by technology companies seeking to access renovated historic buildings and Class A glass and steel towers. The planned repositioning is intended to attract technology and finance sector tenants, which are the primary occupiers of large block space. With a 20-year track record of successfully redeveloping assets across Manhattan, Tribeca Investment Group will oversee the execution of this transformational project.
“Demand for Manhattan office space continues to strengthen, and the Midtown South neighborhood has been particularly attractive to tenants, outperforming the broader market as a result,” said Cathy Marcus, PGIM Real Estate’s Global Chief Operating Officer and Head of the United States. “As supply in Midtown South continues to be absorbed, we recognized a rare opportunity to reposition 295 Fifth Avenue into what will become a preeminent office asset located within a highly sought-after submarket.”
Planned improvements at 295 Fifth Avenue comprise extensive base building work including the construction of a new lobby, the installation of new retail storefronts, the addition of attractive amenity spaces, and significant mechanical upgrades. Moreover, tenant spaces will be redeveloped into contemporary loft offices, and the joint venture will construct a large glass addition on the building’s rooftop that offers panoramic views of Midtown. A collection of best-in-class firms including CBRE and STUDIOS Architecture will be involved in the design, construction and lease-up.
Upon its completion in 1921, the George Backer-developed property influenced a shift of this stretch of Fifth Avenue from retail to wholesale commerce and has served as the leading showroom building for the home textiles industry ever since. This transaction marks the first time 295 Fifth Avenue has traded in its history, and its planned redevelopment reflects the ongoing evolution of the Midtown South submarket. Leading this project, Tribeca Investment Group is at the forefront of ushering 295 Fifth Avenue into the future and writing the next chapter in the building’s storied legacy.
Darcy Stacom, Bill Shanahan and Doug Middleton of CBRE represented the family ownership on the ground lease, and CBRE’s David Hollander and Peter Turchin will oversee leasing at the property. Duval & Stachenfeld LLP, Goodwin Procter and Davis Polk & Wardwell LLP acted as legal advisors to Tribeca Investment Group, PGIM Real Estate and Meadow Partners, respectively, in the transaction.
About Tribeca Investment Group
Tribeca Investment Group is a private real estate investment firm specializing in the acquisition, development and management of commercial and residential real estate properties in Manhattan. Founded by Bill Brodsky and Elliott Ingerman in 2000, the firm has successfully invested over $2 billion in Manhattan real estate assets with a proven track record of identifying attractive investment opportunities that others overlook and leveraging its deep local market expertise to implement repositioning programs designed to unlock embedded value. This strategy has proven to deliver compelling risk-adjusted returns across all market cycles. For more information, please visit https://www.tribecainvestmentgroup.com/.
About PGIM Real Estate
PGIM, the global investment management business of Prudential Financial, Inc. ( NYSE: PRU ), is one of largest real estate investment managers in the world, with more than $173.5 billion 1 in gross real estate assets under management and administration, as of 30 June 2019. Through its PGIM Real Estate and PGIM Real Estate Finance businesses, PGIM leverages a 140-year history of real estate lending on behalf of institutional and middle-market borrowers 2, a 49-year legacy of investing in commercial real estate on behalf of institutional investors, and the deep local knowledge and expertise of professionals in 31 cities around the world.
1 AUA equals $34.5 billion.
2 Includes legacy lending through PGIM’s parent company, Prudential Financial, Inc.
About Meadow Partners
Meadow Partners is a private real estate investment firm based in New York City and London that manages a series of closed-end private equity funds and separate accounts on behalf of institutional investors. The firm specializes in middle-market transactions in all sectors and across the risk spectrum. Since inception, Meadow Partners has invested over $1.5 billion of equity and has acquired more than $5 billion of real estate assets in its target markets of New York City, Washington, D.C., London, and Paris. Meadow Capital Management LLC is registered with the SEC as a Registered Investment Adviser.
View source version on businesswire.com:https://www.businesswire.com/news/home/20191023005468/en/
Jason Chudoba or Megan Kivlehan
ICR for Tribeca Investment Group
KEYWORD: NEW YORK UNITED STATES NORTH AMERICA
INDUSTRY KEYWORD: COMMERCIAL BUILDING & REAL ESTATE CONSTRUCTION & PROPERTY FINANCE URBAN PLANNING REIT PROFESSIONAL SERVICES INTERIOR DESIGN ARCHITECTURE OTHER CONSTRUCTION & PROPERTY RESIDENTIAL BUILDING & REAL ESTATE
SOURCE: Tribeca Investment Group
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PUB: 10/23/2019 09:09 AM/DISC: 10/23/2019 09:09 AM