By Daniel Geiger
OrbiMed Advisors, a private equity fund that invests in healthcare, has signed a lease for the entire 54th floor of 601 Lexington Avenue for rents above $100 per s/f.
The space, about 30,000 s/f in size, had been occupied until recently by the law firm Howrey, which dissolved its operations earlier this year.
OrbiMed will be relocating from 767 Third Avenue, where it leases that building’s 30th floor. Although it wasn’t clear by press time exactly what OrbiMed will pay in the deal at 601 Lexington, several knowledgeable sources said that the company agreed to rents that start just higher than $100 per s/f.
Calls to OrbiMed were not returned by press time. The company is a private equity and venture capital firm that invests in pharmaceuticals, biotech, and medical devices, according to public information. Neil Goldmacher, an executive at the real estate services firm Newmark Knight Frank, represented OrbiMed in the lease. Goldmacher could not be reached for comment.
Howrey, a Washington based law firm known for its intellectual property practice, wound down in March after months of defections among partners according to written reports.
Boston Properties has had to deal with other tenant dissolutions, including the bankruptcy of Lehman Brothers, which was a large tenant at 399 Park Avenue, a high-end office tower that the company owns nearby between 53rd and 54th Street. Boston Properties, one of Manhattan’s largest landlords, ended up filling that vacancy during a difficult period of leasing amid the depths of the recession.
With an improving office market however, its job of finding a replacement at 601 Lexington for Howrey appeared far easier and more lucrative.
Just a year ago, the marketability of 601 Lexington appeared to be in a different position. The building’s largest tenant, Citibank, which occupies hundreds of thousands of s/f in the iconic, slant-roofed, 1.7 million s/f skyscraper, put a large portion of its space on the market for sublease, an offering that appeared likely to undercut the value of vacancies for lease directly from Boston Properties. The bank, however, has subsequently removed that space and with few empty floors, the tower now commands premium rents. Currently, only 601 Lexington’s 26th floor is available.
Meanwhile, Boston Properties will be getting back a block of space at 399 Park, about 150,000 s/f that will be vacated next year by the law firm WilmerHale, which is leaving to go to 7 World Trade Center in lower Manhattan. With rents clearly bouncing back to pre-recession heights for premium office buildings, 399 Park is likely to draw triple figure deals, experts say.
