While some older buildings are declining, others are thriving: Two new deals totaling 104,000 square feet have brought occupancy at George Comfort & Sons’ 960,000-square-foot 498 Seventh Ave. to 95 percent.
Publicly traded technology company Pubmatic signed a direct lease for 60,000 square feet. The subtenant plans to nearly double its space in the first quarter of 2025.
Meanwhile, engineering firm Hazen & Sawyer has extended its lease for 44,000 square feet until at least 2035.
George Comfort CEO Peter S. Duncan said the property’s “bright workspace, flexible floor plans, convenient amenities and unmatched location in the heart of the city’s most important transportation hub” were key to its success.
The 25-storey building opened in 1920 and underwent a major modernisation in 2021. The owners commissioned design firm Gensler to renovate the lobby that runs through the block on the ground floor.
Market sources say asking rents are in the $60 range.
Other tenants at 498 Seventh Ave. include engineering firm Cosentini Associates, construction boutique Milrose Consultants, design firm Dattner Architects and construction company The McKissack Group.
Matt Coudert and Andrew Conrad acted as in-house agents for George Comfort on both transactions. Greg Taubin of Savills acted for Pubmatic. Curtis Dean of CD Commercial Real Estate Services acted for Hazen and Sawyer.
Midtown office building with dated features
Telecommuting has been blamed for all the problems in Manhattan’s commercial market. In a New York Times article about 135 W. 50th St., which listed for $8.5 million and traded for $332 million in 2006, developer David Sterner cited it as one of the reasons “most buildings are no longer considered safe investments.”
But if 135 W. 50th St. is half as bad as the one described by reporter Matthew Haag — with an outdated layout, barely any light, ceilings that are too low and even leasehold encumbrances — the $8.5 million price tag seems almost exorbitant.
WFH makes it nearly impossible to explain the property’s 35% occupancy rate: Companies are moving out because the building is becoming the kind of burden landlords took for granted in an era of low interest rates and corporate expansion.
While WFH will never go away completely, it appears to be on a gradual decline.
Occupancy rates in 350 Manhattan buildings reached 77% of pre-pandemic baselines compared with 2019, according to a new New York Association of Realtors study based on location data from Placer.ai.
This is the highest monthly level since REBNY began tracking in February 2023.
As always, Class A+ properties led the way in building visits, reaching 91% in June compared to 2019, up from 83% in June 2023.
