The remaining interest in the building, located between 36th and 37th streets, will stay in the hands of George Comfort & Sons and Loeb Partners Realty. The three partners bought the building from the Helmsley portfolio in 1998 for about $45 million. According to George Comfort president Peter Duncan, the asset is roughly 95% leased and the change in ownership partners will not affect plans for the recently renovated building going forward.

"We are planning on holding [the asset] long term with our new partner," Duncan tells GlobeSt.com. "This was the decision [Northstar] came to and we worked with them to accommodate their feelings." Duncan adds that the partners "started repositioning the building 1n 1997" and performed "significant renovations in 1999 and 2000."

Denis Epoh, director of investments at SITQ Immobilier, says the 874,000-sf prewar building's well-maintained condition made it an attractive investment. "We were attracted to this building by the asset quality, which has a great and strong value creation story," he says. "We were also drawn to this investment by the quality of our operating partners."

The building recently signed Seattle-based Washington Mutual Inc. to a 10-year lease for 3,500 sf of ground-floor retail space in the building at $125 per sf. The bank will install its first New York City branch there. Garrick-Aug Worldwide Ltd vice chair Faith Hope Consolo arranged the lease and is marketing additional retail space in the building.

Currently, Consolo says she is negotiating a lease for a duplex space--5,000 sf on grade and 11,000 sf on the building's lower level. "We have some offers but we haven't chosen a tenant yet," she tells GlobeSt.com. "We're not just looking for a good tenant. We want a great-looking store for the building."

Retail tenants leasing space at the property include Alkit Pro Camera and Murano's Restaurant. Office tenants include the headquarters for Bates Worldwide Advertising Group, Interpublic Group, Mass Mutual (Oppenheimer Fund), Hazen & Sawyer, Intimate Brands, and Data Broadcasting, Modell's Inc., Betsey Johnson and Victoria's Secret. Published asking rents office space at the property are between $45 and $50 per sf.

Instant Insights /

SITQ Pays $101 Mil for 50% Stake in 498 Seventh Ave.

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