SL Green Lands Major Lease Renewal

SL Green Realty Corp. has renewed major tenant The Travelers Insurance Co. for 122,788 square feet at 485 Lexington Ave. in Manhattan. The insurer will remain on a portion of the seventh floor and all of the eighth and ninth floors for an additional 10 years.

This transaction reportedly bumps SL Green’s office leases executed so far this year to more than 3.5 million square feet, with a pipeline of more than 900,000 square feet.

485 Lexington Ave., also known as Grand Central Square, totals 904,165 rentable square feet of office space across 32 stories and dates to 1957, though it’s nonetheless still a Class A building, according to CommercialEdge. It has an overall vacancy of about 13 percent.

Travelers Insurance was represented by Robert Ageloff, Matt Astrachan and Kate Roush of JLL, and SL Green was represented by Paul Glickman, Alex Chudnoff, Diana Biasotti, Christine Colley and Kristen Morgan, also of JLL.

SL Green is the largest office landlord in Manhattan and holds ownership interests in more than 28 million square feet of Manhattan buildings.

Big money on the hunt

The lease announcement closely followed the news that a major Canadian pension fund, reportedly Caisse de Dépôt et Placement du Québec, has committed $250 million for a new SL Green opportunistic debt vehicle.

The fund, for which SL Green hopes to raise a further $250 million by year’s end, is said to focus on distressed credit opportunities in New York office and retail real estate, including existing loans, loan portfolios and controlling CMBS securities. The fund will also originate loans.

Manhattan’s office market saw 5.47 million square feet of leasing activity in the third quarter, which was 8 percent above the five-year quarterly average, according to a report from CBRE. In turn, overall availability declined by 50 basis points year-over-year, to 19.3 percent.

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