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With Pfizer HQ Deal in Hand, Tishman Speyer Set to Start Building 2M-SF Spiral Office Tower in Hudson Yards

Pharma Conglomerate to Relocate HQ in 2022
April 10, 2018

The Spiral, a 65-story, 5-Star proposed office tower at 66 Hudson Blvd. in Manhattan.
Credit: Tishman Speyer

Tishman Speyer said it plans to commence construction in June 2018 on The Spiral, a 65-story office tower in Manhattan's emerging Hudson Yards area, after securing financing and finalizing a 20-year lease for 800,000 square feet with Pfizer in the developer's planned 2.08 million-square-foot office tower.

Pfizer will relocate its headquarters from 235 East 42nd St. to Tishman's new tower in 2022, where it will occupy 15 floors (7 through 21) plus portions of the lobby level.

Designed by BIG-Bjarke Ingels Group, The Spiral will soar 1,031 feet and feature a cascading series of landscaped terraces and hanging gardens as its signature design element.

Tishman says it has closed on "all the necessary financing" to build the $3.7 billion project. Blackstone Mortgage Trust (NYSE: BXMT) has committed $1.8 billion to the project, and Tishman put up $1.9 billion in equity with its own funds and a mix of "more than a dozen" institutional, pension fund and individual investors.

Of Blackstone’s funding package, $185 million will be infused short-term, with the remainder kicking in after Tishman’s equity investment completes in approximately two years.

BXMT CEO Steve Plavin said his firm's "well-protected, low leverage loan has an extremely strong credit profile and is consistent with BXMT’s strategy of lending on institutional quality real estate with strong sponsorship in gateway markets."

BXMT was advised in the financing by law firm Fried Frank. Sullivan & Cromwell advised Tishman Speyer.

Credit: Tishman

Standing midway between the High Line and Hudson Boulevard Park, The Spiral’s Midtown West footprint takes the entire block between 10th Avenue and Hudson Boulevard, bordered by West 34th and 35th Streets.

Turner Construction will be the general contractor, overseeing about 7,600 construction jobs. The Spiral will create 7,100 new office, retail and building-service jobs upon completion, Tishman says.

"The intricacies of a headquarters relocation and negotiating an anchor tenant lease at a brand new development is highly complex and takes a thoughtful, strategic plan where all disciplines are perfectly aligned," said Josh Kuriloff, executive vice chairman with Cushman & Wakefield, which represented Pfizer in lease negotiations at The Spiral.

Pfizer has retained Cushman's Adam Spies with arranging the sale of Pfizer’s current headquarters. Pfizer is planning to sell its Midtown office buildings properties at 219 and 235 West 42nd St. to New York real estate investor David Werner for approximately $360 million. The pharmaceutical firm is expected to leaseback all or a portion of its space until The Spiral is finished in 2022, according to the Real Deal, which first reported the sale. Evan Babcock and Marc Hurel, partners with law firm Stroock & Stroock & Lavan LLP advised Pfizer.

Diana Bell, New York City Market Reporter  CoStar Group   
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