By Daniel Geiger
Icahn Associates, the investment firm run by the financier and corporate raider Carl Icahn, is in preliminary talks to renew its lease at the top of the General Motors Building, one of the priciest and most exclusive office towers in the city.
Icahn Associates has about 30,000 s/f of space in the 50-story, roughly two million s/f tower, a portion of floors 47 and 48, which are about 40,000 s/f in size.
The company, which invests in hedge funds and private equity firms, has a lease set to expire at the property next year.
Although a renewal deal is only in preliminary talks, sources say, many view Icahn as a captive tenant in the property, the kind of successful, deep-pocketed firm likely to pay the building’s hefty premium in order to remain at one of the city’s most prestigious addresses.
Other established icons of Wall Street have also moved to renew their pricey offices in recent months. As Real Estate Weekly first reported, Kohlberg Kravis & Roberts and Apollo Global Management, two investment firms, extended their leases at 9 West 57th Street earlier this year, a neighbor of the GM Building that is also one of the city’s highest end buildings.
In those deals KKR took about 140,000 s/f and Apollo took about 125,000 s/f for rents hovering in the $140s psf, according to sources, making them among the most lucrative lease transactions to get done since the recession for their combination of size and exorbitant rates.
It’s not clear what rents Icahn would have to pay to renew, but market sources say that it would probably be in the upper $100s per s/f.
The home building firm Hovnanian Enterprises just renewed its space on the GM Building’s 46th floor for five years at $175 per s/f rents. A person familiar with the building said that Icahn would likely have to pay a similar, if not even higher rate.
A CB Richard Ellis leasing team represents the building for the real estate investment trust Boston Properties, which owns the trophy tower. Neither brokers at CBRE nor executives at Boston Properties could be reached. Icahn Associates also did not return calls seeking comment.
