The Manchester-based firm signed a 10-year deal for 5,851 square feet on the entire 41st floor of Tribeca Associates’ 47-story building between Exchange Place and Beaver Street, brokers on the deal said. Asking rent was $56 per square foot.

Hargreaves Jones — whose projects around the country include Denver Union Station in Colorado and Willoughby Square Park in Brooklyn — previously had its offices at 180 Varick Street in Hudson Square, but moved to its new digs on Sept. 1.

Negotiations for the lease started during the coronavirus pandemic lockdown, and were done completely virtually, with the tenant only able to tour the space alone, said Newmark Knight Frank’s Andrew Peretz, who worked on the deal for the landlord.

“There’s been so much negative news about office space, this is a ray of sunshine,” Peretz said. “This was not a pre-existing deal. It started, was negotiated virtually, and closed during the shutdown.”

Peretz brokered the deal for the landlord along with Hal Stein, David Malawer and Daniel Appel, also of NKF. LSL Advisors’ Eric Siegel and Wayne Siegel handled it for the tenant.

“Both sides were creative and eager to finalize the transaction during these unprecedented times,” Wayne Siegel said in a statement. “As employees slowly begin to return to the office, we are incredibly optimistic about the future of New York City.”  

Other tenants in the 476,000-square-foot 30 Broad include flexible workspace provider Knotel, artificial intelligence composer-developer Amper Music and stockbroker Joseph Gunnar & Co.

AllianceBernstein provided $105 million to Tribeca Associates to refinance its construction debt on the 143 Fulton Street hotel in 2018, Commercial Observer reported. The transaction, which closed July 31 of that year, included the assignment of roughly $61 million in previous construction debt from Bank of the Ozarks (now known as Bank OKZ) originated in 2016. It also included a new $44 million gap mortgage from AllianceBernstein.

The 298-room hotel, designed by SLCE Architects, was the second of the Moxy brand to open in New York City, following the Marriott-affiliated brand’s location in Times Square developed in partnership with the Lightstone Group. Lightstone and Marriott have four other Moxy outposts in the city, and are planning even more. 

AllianceBernstein and Tribeca Associates did not immediately respond to requests for comment.

The Moxy NYC Downtown is not alone, with several other hotel owners returning a property to a lender during the pandemic.

The pandemic ended the longest bull run in commercial real estate’s history, making the market far more amicable for lenders than borrowers. The tangible impacts of that shift have been plain; the owner of Hilton Hotel in Times Square returned the property to one of its mortgage holders in January and Mack Real Estate took control of a seven-hotel portfolio through UCC foreclosure proceedings in March and last month.

While that’s welcome news to those who fretted about the death of the office as we know it, some CEOs have handled the push toward in-person work less than gracefully.

WeWork CEO Sandeep Mathrani faced a battering online after he told The Wall Street Journal that the “least engaged” workers are the ones who don’t want to return to the office.

“Those who are uberly engaged with the company want to go to the office two-thirds of the time, at least,” Mathrani said, according to WSJ. “Those who are least engaged are very comfortable working from home.”

The comments didn’t go over so well among the notoriously critical Twitter crowd.

“Productive and engaged employees also prefer home work,” Twitter user @rebelheartedfox wrote. “Fuck off with that ‘office culture’ that breeds every sort of fucking harassment possible.”

Ouch.

But Mathrani wasn’t the only one diagnosed with return-to-work foot-in-mouth disease recently. Cathy Merrill, CEO of D.C. magazine, the Washingtonian, caused her staff to revolt after penning an op-ed in The Washington Post many saw as threatening to demote staff to “contractor” status if they chose not to return to the office.

Merrill later walked back her comments, but the damage was done and the Washingtonian halted publishing for a day in protest.

“We’re just a little baffled,” a Washingtonian staff member told Commercial Observer. “In the middle of the pandemic, to have health insurance brought into the conversation for us, I think, was definitely very concerning.”

Hotels still face hospitality woes

The expected pent-up demand from travelers making trips over the summer as coronavirus restrictions ease is unlikely to end hotel’s troubles anytime soon. 

A slew of hospitality and travel companies earning calls revealed that some fell short of expectations and others posted big losses. Expedia lost $606 million in the first quarter, while Hyatt Hotels Corp. lost $304 million. The post-pandemic leisure travel boom may happen, but business travel isn’t expected to do the same.

Distress in the industry continues to be felt, with Tribeca Associates being forced to give back the Financial District’s Moxy Hotel to lender AllianceBernstein.

And on top of a potentially onerous hotel construction permit entering public review, New York City Councilman Ben Kallos introduced a bill last week to tighten city regulations on Airbnb and other home-sharing sites.

The proposed legislation would give listings on those sites a registration number, and require the host to be the lawful occupant of that property, and to be present during any rental period. Kallos said that could be good news for the struggling hotel industry as it will trim the number of Airbnb listings in the city. 

And the tourism industry got a bit of good news last week, when “Hamilton,” “The Lion King” and “Wicked” — Broadway’s top blockbusters — announced they will resume performances on Sept. 14.

Miracle on 34th Street

Macy’s wants to build a new tower on top of its iconic Herald Square flagship, and is sweetening the pot with $235 million for the neighborhood.

The department store proposed a plan to turn Herald Square and Broadway Plaza into a car-free urban space, and add entrances and elevators to nearby subway stations.

Macy’s goodwill for the neighborhood comes as it’s trying to get the city to approve a 700- to 950-foot-tall tower on top of its flagship that will add 1.5 million square feet of office space to the neighborhood.

And Macy’s isn’t the only one pitching sweeping development plans.

RFR Holding’s Aby Rosen is in contract to buy 522 Fifth Avenue’s retail space, after picking up the office portion last fall, so he can convert it to office and offer the entire tower to a single tenant.

Plans call for three terraces, a fitness center, and turning an old bank vault into meeting rooms.

Meanwhile, Savanna sealed a deal for $264 million in construction financing to get cracking on its 400,000-square-foot, office-and-retail project at 141 Willoughby Street in Downtown Brooklyn.

Yet, the city is still facing a huge slowdown in the number of new buildings being developed. A report from the Real Estate Board of New York found that the city saw the smallest amount of square footage for new construction in a decade.

Move over, financial services 

The financial services sector looks to be losing its perch as the top driver of office leasing in Manhattan, with tech companies now leading the market in a way never seen before.

Tech, advertising, marketing and information services, or TAMI, accounted for most of Manhattan’s leasing momentum coming out of COVID-19 and many of its biggest deals during the pandemic.

In 2010, TAMI companies occupied 18.5 percent of offices in Manhattan, but grew to 25.1 percent in 2020, according to Cushman & Wakefield. During that same time, financial services and insurance dropped from just shy of 37 percent to 29 percent.

Deals on deals on deals

The near-complete pause on sales and leases seems to be firmly in the rearview mirror.

SLR Capital Partners reupped and expanded its offices at 500 Park Avenue, growing its presence to 28,165 square feet in a 12-year lease. Nearby, Wellspring Philanthropic Fund grew at 10 Times Square to 43,000 square feet.

On the retail front, popular third-wave coffee seller (think lighter-roast beans and manual brew methods) Devoción inked a deal for a 1,400-square-foot outpost in Dumbo, Brooklyn. Ghost kitchen Nimbus took 9,512 square feet at 100 Willoughby Street in Downtown Brooklyn, which will have a retail component open to the public.

Speaking of Brooklyn, the borough’s sluggish market got a boost with the news that Brookfield Property Partners is in contract to sell its Downtown Brooklyn office condominium for $130 million.

Enjoy the rest of your Sunday. And, gear up, because Commercial Observer’s annual Power 100 hits this week!

Just remember, before you call to curse us out for getting lowered in our rankings, isn’t it at least an honor to make the list at all?

Asking rent was $250 per square foot for 3,500 square feet on the ground floor and $60 per square foot for space in the basement, mezzanine and second floor of the building, according to Colliers’ David Tricarico and Jake Horowitz, who brokered the lease for both sides.

Reznik, who owns the CompleteBody gym chain, said he jumped on the deal because of 30 Broad’s proximity to multiple subway lines and CompleteBody’s 10 Hanover Square location. Plus, the space’s previous use as a New York Sports Club outpost made it much cheaper to renovate, he added.

He hopes the gym’s dance, yoga and martial arts classes will benefit both his own two children and other kids in the neighborhood in need of indoor activities, which Tricario said the Financial District has plenty of. 

“The location is great because it services the new clientele of Downtown [Manhattan] which is very family-oriented,” Tricarico said. “It’s located close to One Wall Street, which is a power retail space at the base of a luxury building, so this is like the next piece of the puzzle.”

Other tenants at the 50-story 30 Broad include media production company PS 260, architecture firm Woods Bagot and consultants Maximus Inc.

A spokesperson for Tribeca Associates did not immediately respond to a request for comment.

Celia Young can be reached at cyoung@commercialobserver.com.