GLORY DAYS: CME is looking to sell the Nymex building, where oil options traders have earned their stripes. (Bloomberg)
It’s time to start the bidding for the home of the New York Mercantile Exchange.
We’ve learned that Chicago-based exchange operator CME and its broker, Holly Duran Real Estate Partners, tapped Jimmy Kuhn and Jennifer Schwartzman of Newmark Grubb Knight Frank to sell the 16-story Class A office building at 1 North End Ave. The companies declined comment.
Known as the Nymex building, it housed trading pits where billions’ worth of energy, metals and other commodities contracts changed hands until CME bought the parent company for $9.8 billion in 2008.
Some trading is still conducted on the floor, but so much is now electronic that CME expects to downsize and will likely lease back half the property at rents that sources said will be around the low-$50s per square foot.
Developed for the exchange by Forest City Ratner in 1997, the building is on land leased from the Battery Park City Authority until June 2069. Because of the numerous area vacancies at both the adjacent Brookfield Place towers and the World Trade Center, it is doubtful that bidding will top $400 to $500 per square foot because it will also be a half-empty building.
That said, the nearby St. John’s University Center at 101 Murray at West Street, is being sold for $400 per developable square foot to Steve Witkoff, Fisher Bros. and Howard Lorber. However, that sale is being driven by the searing-hot residential market, and the building will eventually be torn down and replaced with a 400,000 square-foot luxury condominium tower.
The Nymex building has both triple- and double-height trading floors. It is expected that one of those will be in-filled, adding an extra interior floor so as to total 560,000 square feet.
Currently, public filings show the exchange occupies 350,000 square feet. According to CoStar, the 10th floor has a dining room and outdoor patio, a boardroom, conference room, health club and library.
The building sits directly on the Hudson River and boasts sweeping, unobstructed views. It was built high enough off the water not to have been affected by the Sandy storm.
Most of the large local value-added investors such as Brookfield, Vornado Realty Trust, Blackstone, RXR, RFR and perhaps even SL Green, which has yet to invest in a downtown building, are likely to be tempted to bid on this rare and iconic offering.
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A fiscal-cliff loophole that stands to benefit building owners who have held onto their properties in S corps for at least five years has prompted at least one sale.
Hoping to take advantage of the favorable tax treatment, the owners of 247 W. 30th St., between Seventh and Eighth avenues, are trying to sell the 70,200 square-foot office building for $35 million, or about $486 a square foot.
Infinity Real Estate and Katz Properties have hired Eric Anton, Ron Solarz and Eric Weinberg of Brookfield Financial to market the 1926-era building, which was renovated in 1988 and again after they purchased it in 2008 for $14.75 million.
The north Chelsea building close to Herald Square, Hudson Yards and the High Line has attracted a number of small tenants with its raw vibe and lower rents.
Numerous setbacks also provide coveted outdoor spaces and Midtown Manhattan views on floor plates that range from 2,500 to 5,500 square feet — perfect for techie “feeder” tenants that can be moved to larger spaces in other portfolio-owned buildings as they grow, according to Anton.
When the current sellers purchased the C-corp that owned the building, they immediately converted it to an S-corp.
Under past IRS rules, Anton said an S-corp had to have been held for 10 years to garner favorable tax treatment and avoid what is known as the “BIG” tax.
During last year’s fiscal-cliff negotiations, however, Congress added a one-time change so that an S-corp only had to be held for five years. But to provide immediate stimulus, the change would only benefit sellers of S-corp’s during 2012 and 2013.
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The future’s so bright that Oakley sunglasses is opening a new flagship store at 560 Fifth Ave.
The 6,800 square-foot space on the ground, second and lower levels at the southwest corner of 46th Street has 105 feet of wraparound frontage and is expected to get a cutting-edge design both inside and out.
David Rosenberg and Beth Rosen of RKF and Ellen Lee of Natick, Mass.-based Milestone Associates represented the tenant. Mark Stempel of CityVest Realty represented the property owner, the Riese Organization, which had an asking rent of $1,150 per square foot for the ground floor space.
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The “Girls” of the HBO hit hang out at Café Grumpy, and now fashionistas in Times Square South can, too. The brewing bar signed a 1,000 square-foot lease to open at 530 Seventh Ave. at West 39th St.
Scott Kummings and Michael Schoen of Savitt Partners represented Grumpy, while Savitt colleagues Brian Neugeboren and Nicole Goetz worked for building owner Bob Savitt in-house. The asking rent was $125 a square foot.
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With the addition of the third floor, Jaysuites will be expanding its Times Square location at 1441 Broadway by another 21,700 square feet.
The shared office group, which currently has the 5th floor, will expand to a total of 43,400 square feet.
The company was represented by Richard Doolittle of Murray Hill properties, who, along with John Howard, is also the agent for the site. The asking rents are in the low $50s per square foot.