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Bloomberg LP extends lease at 731 Lexington Ave.

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Michael Bloomberg’s media organization extended its lease at 731 Lexington Ave., providing a big win for the building’s owner shortly before its $500 million mortgage comes due.

The 11-year extension takes effect when Bloomberg LP’s existing lease for 950,000 square feet expires in 2029. The firm will retain all its space. Terms weren’t disclosed, but the media organization paid $132 per square foot in 2022, Crain’s reported

“We’re glad to be staying,” said Bloomberg, CEO of Bloomberg LP and the former mayor, adding he’s a believer in “the power of in-person work to drive collaboration and innovation, and 731 Lexington’s open spaces help us do that.”

For the building’s owner, Alexander’s Inc., the timing couldn’t be better because the mortgage expires in June and will have to be refinanced, likely at a higher rate. Alexander’s, which is managed by Vornado Realty Trust, had asked lenders to extend the loan before signing the lease extension with Bloomberg, and Fitch Ratings lowered its outlook for the mortgage in February on the risk a deal might not get done. Signing the tenant that occupies 98% of the office space should make refinancing much easier.

The 1.3 million square-foot, 56-story building at the corner of East 59th Street was developed by Steven Roth and opened its doors in 2004. The top floors are residential, and Bloomberg’s global headquarters take up most of the rest. 

“Bloomberg’s decision to remain is a testament to the rare and enduring quality of the tower,” Roth said in a statement.

 

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Aaron Elstein , 2024-05-06 17:00:54

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