Broadway since 2002.
NEW YORK CITY-Seven blocks uptown from its flagship Herald Square store, Macy’s Inc. has been an office presence at 1440 Broadway for nearly three decades. The retailer has inked its third expansion at the Monday Properties office tower since 2011, while extending the lease for the existing space, bringing its total footprint there to more than 197,000 square feet.
The latest expansion for Macy’s entails the retailer taking over the entire 10th floor at the 743,000-square-foot property, thereby adding 31,700 square feet to its existing 166,000 feet on floors six through nine and thirteen. The lease for the existing space is also being concurrently extended for 11 years, a Monday Properties spokesman tells GlobeSt.com.
Just after the start of 2011, Macy’s said that growth of its e-commerce operations prompted it to expand its presence at 1440 Broadway by 56,242 square feet. In June of last year, Macy’s found 10,000 square feet more to grow into at the 25-story Midtown tower.
“Macy’s latest expansion at 1440 Broadway follows our core approach to supporting each tenant’s business,” Monday EVP and COO Brian Robin said when the June ’11 expansion was announced. “Monday Properties identified an off-market growth opportunity for Macy’s that allowed the tenant to make a smart real estate decision without the need to look anywhere else.”
The latest expansion was a bit more complex. The expansion space for Macy’s was originally leased to Advance Magazine Publishers, the parent company of Condé Nast, and had been subleased to law firm Skadden, Arps, Slate, Meagher & Flom LLP since 2006. Skadden Arps had recently been marketing the 10th floor space for sub-sublease. In what’s described as a complex four-party transaction, Monday Properties recaptured the entire floor simultaneously from Skadden Arps and Advance, thus making it available to Macy’s.
“Monday Properties developed a growth path for Macy’s in a contiguous block for their long-term expansion,” Robins says in a release. “The result was simple, but it relied on creativity and collaboration with the Macy’s team to convert separate components into an efficient space solution.”
Scott Gottlieb and Michael Laginestra, both vice chairmen of CBRE, represented Macy’s in the transaction, as they’ve done in prior expansions. Skadden Arps was represented by David Goldstein of Studley in the 10th-floor buyout negotiations, while Advance handled negotiations in-house. Jordan Berger of Monday Properties represented the landlord.
Although 1440 Broadway is traditionally 100% occupied, Monday Properties is now marketing the entire second floor. The full floor of 33,577 square feet provides 12’6” slab-to-slab heights, new oversized windows, new restrooms and new tenant-controlled HVAC units, according to a release.
Macy’s has been a tenant at 1440 Broadway since 1983, and Monday Properties, which has been managing and co-leasing agent there since 1999, acquired the tower in 2002 for $230 million, recapitalizing it to the tune of $434 million in August 2007. Along with Macy’s, other office tenants there include Fifth and Pacific Cos., Razorfish and Mizuho Capital Markets.