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GHC Development Explores Leasing Opportunities for 123 Greenwich

Thor to List 80,000 SF Available at the Original American Stock Exchange Building, which is Being Topped with a Boutique Hotel
January 31, 2018
GHC Development LLC, which bought the original American Stock Exchange building at 123 Greenwich St. (86 Trinity Pl.) in 2011, is ready to bring the property to the leasing market. The developer tells CoStar News that it waited for the downtown market to mature while securing zoning permits, air rights and landmark status on the property.

"Now that the World Trade Center building and Brookfield Place are established, the downtown revival is really taking place," says Allan Fried, CEO of GHC Development.

A boutique hotel is being planned for development and will be at the top floors of the property, according to GHC, but the company is targeting long-term experiential retail and entertainment tenants for the 80,000 square feet of space available at the property, which has 60- to 80-foot ceilings and two separate ground floors due to grading differential. The retail availability spans three levels of the seven-story building, which was originally built in 1921.

In addition to the cavernous ceiling space, Fried cites 25,000 square feet on the main floor and 20,000 square feet of column-free space on the mezzanine as elements that make the property unique compared to Brookfield.

Louis Vuitton appears to have agreed. The couture brand signed a short-term lease with GHC Development to host an autobiographical exhibition there, incorporating a full-size propeller plane model, railway car and two-story mast with a sail into the space. Louis Vuitton exited the lease for its mini-museum on January 7. It had spent $15-20 million outfitting the space, according to sources with knowledge of the arrangement.

Now, GHC has retained the Thor Retail Advisors LLC team of Dan Harroch, Matthew Seigel and Payal Doshi to be exclusive leasing agents on the property. The developer says it will spend about $65 million refurbishing the interiors for new tenants. It is targeting experiential retail tenants, such as a technology company that would use to showcase or maintain a product's identity.

"A new flavor of tenants were moving in - from media, tech, art," Fried says, citing large-block leases signed by Conde Nast, Spotify and Group M over the past few years while his firm waited for the market to mature and World Trade to finish.

"Seeing Nobu at 195 Broadway as well as a brand-new Target in the area…This is a barometer of where the retail market is going in this neighborhood," he explained. "We have a variety of new retailers. Downtown has become a desirable place to live and to have an office."

Fried adds that he is bullish on the strength of the market downtown, where residential, office and tourism sectors are intersecting.

According to the data from the Downtown Alliance, about 61,000 people live and about 275,000 employees work in the area. Nearly 15 million tourists visited lower Manhattan in 2016, the most recent year for which it has data available.

In 2011, GHC Development acquired the asset as part of a two-property portfolio deal in a joint venture with Steinhardt Management. The seller was the New York Stock Exchange, which absorbed the American Stock Exchange. As part of the deal, GHC and Steinhardt also acquired 18-22 Thames St., paying $65 million, or about $245 per square foot, for both properties.
See CoStar COMPS #2060952.

In 2015, Steinhardt sold 70% interest in the 181,725-square-foot office building to Clarion Partners for $105 million, or $825 per square foot, according to CoStar data.

See CoStar COMPS #3463392.

Fisher Brothers Management purchased 18-22 Thames St. from Steinhardt in 2012 for $82 million, or about $978 per square foot. It has since been demolished. At the site, Fisher Brothers is planning a 72-story apartment building, for which a permit was issued in August 2017.

See CoStar COMPS #2554356.

Diana Bell, New York City Market Reporter  CoStar Group   
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