The New York office of Hines, the international real estate firm, announced that Simpson Thacher & Bartlett LLP has executed an agreement to renew its lease for 595,000 s/f at 425 Lexington in midtown.
Encompassing 26 floors of the 31-story building, the lease will be reset to expire in 2033. The lease extension will become effective subject to typical lender consent or upon completion of the sale and payment of the mortgage, which is due in August 2013.
Lewis Miller, Ken Rapp and Ramneek Rikhy of CBRE represented Simpson Thacher in lease negotiations, while Hines represented the owner, its Hines U.S. Core Office Fund. “We have enjoyed a long relationship with Simpson Thacher, and their confidence in and recommitment to 425 Lexington Avenue speak volumes about the quality of this unique asset,” said Hines’ senior managing director in New York, Tommy Craig.
Michael Hersch, chief operating officer of Simpson Thacher, commented, “We have been pleased to be a tenant at 425 Lexington under Hines’ ownership, and we are happy to have secured 425 Lexington to serve as our world headquarters for at least another two decades.”
In early March, Hines announced that the building would be marketed for sale by Eastdil Secured and CBRE.
Eastdil Secured’s senior managing director Douglas Harmon noted, “Simpson Thacher’s renewed commitment to 425 Lexington dramatically highlights the attractiveness of the asset while solidifying and stabilizing the long-term returns to an investor.” Darcy Stacom, vice chairman of CBRE Investment Properties added, “425 Lexington is a gem in the market, and with the lease renewal, the investment fundamentals are befitting this trophy asset. This is an enormous vote of confidence in the long-term value of this Midtown icon.”
One of the newest buildings in the Grand Central market, the 750,000 s/f 425 Lexington Avenue, occupies the entire easterly block front between 43rd and 44th streets aacross from Grand Central Terminal.