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[IMGCAP(1)]NEW YORK CITY-SL Green Realty Corp. has completed three separate, but linked transactions. The transactions include; Westdeutsche Landesbank buyout, which surrendered the entire 7th floor at 1185 Avenue of the Americas covering 27,508 sf; RSM McGladry’s expansion to 164,771 sf at 1185 Avenue of the Americas; and Regent Business Centers’ new 52,418-sf lease at 750 Third Ave.

[IMGCAP(2)]West LB had eight years of a remaining term at below market rent. The surrender included a buyout fee paid to the landlord. RSM McGladry expanded into the space surrendered by West LB.

Additionally, RSM extended its existing lease term within 1185 Avenue of the Americas by three years and eliminated an existing right to cancel in 2011 resulting in a total commitment of 164,771 sf. The building, located at 1185 Avenue of the Americas, is a 42-story, 1.1-million-sf, class-A tower located between 46th and 47th streets. Steven Durels, EVP and director of leasing and real property for SL Green, tells GlobeSt.com that asking rents at 1185 Avenue of the Americas is $95 per sf, but he was not able to provide taking rents or aggregate lease values.

[IMGCAP(3)]Simultaneously RSM surrendered an existing lease covering 52,418 sf at 750 Third Ave., which had approximately five years of remaining term at below market rent.

Regent Business Centers signed a new 10-year lease covering the 52,418 sf surrendered by RSM McGladry at 750 Third Ave. The building is an 800,000-sf, class-A tower located three blocks from Grand Central Terminal. Durels tells GlobeSt.com that asking rents at 750 Third Ave. are $70 per sf, but he was not able to provide taking rents or aggregate lease values.

Durels tells GlobeSt.com that it was very time consuming and difficult to line up all three deals so that each was executed simultaneously. “It was a house of cards that needed to be tended to carefully.”

He continues that “this series of transactions required delicate balance in negotiating the priorities and schedules of various unrelated parties. The result unlocked significant rental value and mitigates future lease expiration exposure.”

Durels explains to GlobeSt.com that the incentive for the landlord was an increase in rent on all space. “Each of the leases we terminated were substantially below market, so this provided the opportunity to raise all rents up to market years in advance of the scheduled lease expirations.”

RSM McGladry was represented by John Isaacs and Kevin Powderly of CBRE. Regent Business Centers and West LB were represented by Scott Klau of Newmark Knight Frank. The landlord was represented in-house by Howard Tenenbaum, Gary Rosen, and David Kaufman.

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