by Daniel Geiger
Columbia Doctors, a group of more than 200 physicians affiliated with Columbia Hospital, has leased 120,000 s/f at 1290 Avenue of the Americas sources familiar with the deal say.
The organization will take 1290 Avenue of the Americas’ entire third floor, a roughly 110,000 s/f space, as well as a retail duplex abutting 51st Street that it will convert into a dedicated entrance.
The deal will bring the group from 650 Madison Avenue, where it had about 100,000 s/f, and allow it to expand slightly. Columbia Doctors will be installing significant infrastructure in the space including equipment and machines used for medical tests and diagnostics. The outpatient-only facility is used by physicians and medical specialists affiliated with Columbia University’s Medical Center on 168th Street in upper Manhattan. The group has maintained a midtown practice to provide a location that is more centrally located and convenient for patients.
Because of the significant capital expenditure involved in preparing the space for its tenancy, Columbia Doctors signed a long term 25 year lease. The organization will receive more than $60 per s/f to construct its space from Vornado as a concession in the deal but will have to invest substantial money of its own. One source said that the buildout for the organization’s space will cost $200 or more per s/f.
Asking rents for lower floors in 1290 Avenue of the Americas, an over two million s/f skyscraper owned by the real estate investment company Vornado, are in the $70s per s/f. The rates that Columbia Doctors will pay however were not available by press time.
During the summer, the organization was close to a transaction at 600 Madison Avenue, but that deal was canceled in favor of the lease at 1290 Avenue of the Americas. A source said that the duplex retail space was an important component in the transaction. Bank of New York occupies the space for a retail banking location but Vornado worked out an arrangement with the bank to terminate its tenancy there so it could attract Columbia.
A lobby and second floor reception area, which together total roughly 11,000 s/f, will be installed in the duplex in order to create a new entrance to the third floor that will be exclusively used by Columbia Doctors. A person with knowledge of the deal said that the separate lobby was a key requirement that the group was searching for. The dedicated entrance also served the landlord because it will segregate the medical facility’s patients from the building’s predominate traffic of office tenants.
A team from the real estate services firm Newmark Knight Frank, led by company executives Mark Weiss, Neil Goldmacher and Robert Eisenberg, represented Columbia Doctors in the deal. None could be reached for comment. A request for comment on the deal was not immediately available from a spokeswoman for Columbia Doctors.
1290 Avenue of the Americas is represented by a leasing team from Cushman & Wakefield, which has its global headquarters in the property. Calls to C&W brokers on the account were not returned by deadline. Vornado also couldn’t be reached.