661 661 LEXINGTON AVENUE OFFERING MEMORANDUM - Lee & Associates NYC
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661
LEXINGTON
MIDTOWN, NEW YORK
OFFERING MEMORANDUM
661 LEXINGTON AVENUE
MIDTOWN, NEW YORK
FOR MORE INFORMATION, PLEASE CONTACT:
BEN TAPPER CHRIS VARJAN SEAN SLATTERY
Senior Managing Director Senior Managing Director Director
646.658.7334 212.776.1272 646.723.4011
btapper@lee-associates.com cvarjan@lee-associates.com sslattery@lee-associates.com
KYLE WILLIAMS JONATHAN BRAUN GEORGE STEFFANI
Director Director Director
646.723.4715 212.776.4341 212.776.1207
kwilliams@lee-associates.com jbraun@lee-associates.com gsteffani@lee-associates.com
SCOTT MULLIGAN
Associate
212.776.4340
smulligan@lee-associates.com
2
661
LEXINGTON
MIDTOWN, NEW YORK
TABLE OF CONTENTS
Property Overview 4
Development &
Enlargement Opportunity 5
Executive Summary 6
Property Highlights 7
East Midtown 8-9
Stacking Plan 10
Floor Plans 11-13
Neighborhood Map 14
Preliminary Leasehold Terms 15
Comparables 16-17
Disclaimer 18
3
PROPERTY OVERVIEW
661 LEXINGTON AVENUE (AKA 135 EAST 55TH STREET)
Block/Lot
1310/22
Lot and Building Dimensions
60.42’ X 80’
Lot Size
4,833 Sq. Ft.
Building Sq. Ft.
35,426 (Above Grade)
Stories
8
Zoning
C5-2.5 / MiD
FAR
Residential 10
Commercial
and Community Facility 12
ZFA
Residential 48,330
Commercial
and Community Facility 57,996
Unused Development Rights
Residential 12,904
Commercial
and Community Facility 22,570
Property Tax (2021/22 Tentative)
$561,258
Year Built
1902
4
DEVELOPMENT &
661
LEXINGTON
ENLARGEMENT
MIDTOWN, NEW YORK
OPPORTUNITY
661 Lexington Avenue will offer multiple value-add possibilities, including the
opportunity to add additional floors.
CURRENT POTENTIAL
Possible development and renovation ideas include:
• Current zoning and development rights allow for additional floors
• Ability for a user to “brand” the building
• Potential to add building amenities and additional outdoor space
5
EXECUTIVE SUMMARY
661 Lexington Avenue (“the Property”) is a long-term leasehold opportunity for a premier
office building located in Midtown East. Built in 1902, the Property sits on the heavily
trafficked Northeast corner of Lexington Avenue and East 55th Street.
This nine story building features over 35,000 Sq. Ft. of above grade plus a selling
basement, currently used as a restaurant, that encompasses a large majority of the lower
level. The floor plates on the 2nd through 7th floors are approximately 4,800 Sq. Ft.
each, making it the perfect location for midsize tenants or a single user. The 8th and 9th
floors provide the opportunity to create a duplex with multiple outdoors spaces. Zoning
in the area also allows for the utilization of the 22,570 Sq. Ft. of unused development
rights to increase the overall square footage of the building.
The ground floor features over 140 feet of wraparound frontage with three in-place
tenants, all with excellent visibility and exposure. The 55th Street corner is centrally
located and surrounded by a mix of office, retail, and residential buildings. Just blocks
away from all major subway lines and walking distance to Grand Central, 661 Lexington
Avenue offers optionality to investors and users.
6
661
LEXINGTON
PROPERTY HIGHLIGHTS MIDTOWN, NEW YORK
ADVANTAGES AND OPPORTUNITIES
661 Lexington Avenue has the advantage of being situated at the
Northeast corner of East 55th Street affording it excellent visibility, light,
and air. The property’s light and air is further enhanced by being locat-
ed diagonally across the Historic Central Synagogue, a New York City and
National Landmarked building.
The property can be delivered with a clear path to full vacancy at the time
of closing, making it available for investors, developers, or users to begin
immediate redevelopment. The property being unencumbered by
long-term leases or rent regulation allows a new operator to immediately
pursue their business plans for the property’s future use.
Additional advantages include:
• Corner property with over 35,000 gross sq. ft. as well as a renovated
selling basement
• Ability to increase square footage with existing unused development
rights, as well as potential future assemblage linchpin
• Flexible zoning permits residential, retail, commercial, and community
facility uses
• Above average ceiling heights and well-located core
• New elevator mechanicals as of August 2019
• Over 140’ of total frontage
• Not Landmarked or in an Historical District
• Full building branding opportunity on a busy Midtown East corner
7
EAST MIDTOWN
Bounded by Park Avenue and the East River between East 59th Street and
East 42nd Street, East Midtown is a neighborhood with a unique blend
of major employment centers, several different submarkets, and a high
concentration of residential uses.
The submarkets that make up East Midtown include the area surrounding
the United Nations Headquarters to the Southeast, Turtle Bay neighborhood
at the heart of East Midtown, and the Sutton Place neighborhood offering
affluent residential living options. The greatest driver of pedestrian and
commuter activity in East Midtown is the major employment centers and
high concentration of office buildings that East Midtown draws from on
Madison Avenue, Park Avenue, Lexington Avenue, and 3rd Avenue. These
concentrated office corridors make up roughly ±52 million SF in existing
office space with ±905,000 SF of additional office space under construction.
Some projects under construction include L&L Holding’s 425 Park Avenue
office tower and Boston Properties 159 East 53rd Street ±200,000 SF office
building. Hundreds of thousands of employees within East Midtown spurs
demand for a range of daytime general service, food/beverage, and retailers
year-round.
8
661
LEXINGTON
EAST MIDTOWN MIDTOWN, NEW YORK
Coupled with large office inventory on the western side of the neighborhood,
the eastern part of the neighborhood is home to a plethora of cooperative
and condominium walk-up and elevator buildings. The condo concentration
is more evident in Turtle Bay, between 3rd Avenue and 1st Avenue from
East 53rd St down to East 45th Street. The cooperative buildings are
primarily located between 1st Avenue and Sutton Place between East 59th
Street and East 51st Street.The United Nations Headquarters and complex
is located between 1st Avenue and The East River and is surrounded
by a high concentration of foreign government embassies, consulates,
non-governmental organizations, foundations, and nonprofit organizations.
As part of the rezoning for the Special Midtown District (MiD) the New
York City Planning and Zoning has created the East Midtown sub-district
as a long-term guide to development of office space for the next several
decades. This sub-district was established in 2017 and encourages new office
development, offers incentives to improvement of pedestrian areas and
improvements of transit access when coupled with new office development.
9
STACKING PLAN
9
8
7
6
5
4
3
2
Ground
Lower Level
10661
LEXINGTON
FLOOR PLANS MIDTOWN, NEW YORK
LOWER LEVEL
GROUND FLOOR
11FLOOR PLANS
SECOND FLOOR THIRD FLOOR
SINGLE TENANT TWO TENANT
FOURTH FLOOR FIFTH FLOOR
SINGLE TENANT TWO TENANT
12FLOOR PLANS
661
LEXINGTON
MIDTOWN, NEW YORK
SIXTH FLOOR SEVENTH FLOOR
TWO TENANT TWO TENANT
EIGHTH FLOOR NINTH FLOOR
TWO TENANT SINGLE TENANT
13NEIGHBORHOOD MAP
CENTRAL PARK
15
3
14
10
2 661
LEXINGTON
1
13 4
8 9
7 5
12
11
6
1 Central Synagogue 6 Grand Central 11 UN Plaza
2 432 Park Ave Condos 7 Rockefeller Center 12 Dag Hammarskjold Plaza
3 Bloomberg HQ 8 Radio City Music Hall 13 MoMA
885 Third Avenue NYU Langone
4 9 St. Patrick’s Cathedral 14
The Lipstick Building Medical Center
5 Waldorf Astoria 10 The Plaza Hotel 15 Rockefeller University
14PRELIMINARY 661
LEXINGTON
LEASEHOLD TERMS MIDTOWN, NEW YORK
Address 661 Lexington Avenue (aka 135 East 55th street)
Indicate the structure of the proposed lessee entity. Include information about each of the
Lessee
principals and partners. Indicate sources of funding for the proposed development.
Term 50 to 99 years, starting approximately January 1, 2022
Please indicate the initial rent, any proposed phase in period, as well as percentage in-
Rent & Increases
creases and rent resets.
The lease shall be an absolute “Triple net lease” Tenant pays all real estate taxes,
operating expenses, insurance, maintenance and repairs as well as all development and
Net Lease
capital expenditures and any other costs related to the development and operation of the
Property, all of which are the Tenant’s sole responsibility.
Key Money Please indicate all upfront payments upon lease signing.
Please indicate the form and amount of security to be provided. A “Good Guy” guarantee
Security Deposit
will be required.
Proposed Uses Please indicate the proposed use of the Property and the anticipated approximate time
& Initial Plans frame for completion and occupancy of the new development.
Please indicate proposed combination of the following: project completion Bond, cash
Completion Guarantees/
security, letter of credit for completion/development security. Please provide the name and
Development Security
qualifications of the individuals/entities that will act as guarantor(s).
Insurance Lessee will be required to carry insurance on an ongoing basis satisfactory to Landlord.
There will be no transfers, assignments or sublets of the leasehold interest without the
Transfer, Assignment prior written consent of the Landlord. There will be no transfers, assignments or sublets
or Sub-Lease of the leasehold interest prior to completion of construction and obtaining approvals and
certificate of occupancy.
Notes:
Prospective bidders are advised that this Request for Proposal is intended to solicit interest in the Property and that no rights are intended to be created with respect to the Property unless and until a
formal lease agreement is executed between the parties.
15COMPARABLES
SALE COMPARABLES
ADDRESS BLDG SF SALE PRICE DATE PPSF NOTES
150 East 45th Street 39,487 $28,250,000 April-20 $715.43
80% leased at time
15 West 47th Street 136,372 $110,000,000 December-20 $806.62 of sale; traded for
a 4.25% cap rate
331 Park Avenue South
97,000 $82,470,000 June-20 $850.21 Portfolio Sale
& 114 East 25th Street
Single tenant at time of
sale to United Nations
305 East 46th Street 187,060 $152,000,000 November-19 $812.57
Foundation; traded for a
5% cap rate
56 West 22nd Street 66,190 $48,500,000 March-20 $732.74
211 East 48th Street 4,483 $3,800,000 March-20 $847.65
207 East 32nd Street 9,000 $7,500,000 October-20 $833.33
35-37 East 62nd Street 19,968 $25,000,000 April-21 $1,252.00 1/2 of $35M Portfolio
TOTAL/AVERAGE 596,609 $469,190,000 $977.66
CURRENTLY ON THE MARKET
To be delivered vacant;
12 East 53rd Street 24,689 $26,000,000 For Sale $1,053.10
previously leased to LIM
576 Fifth Avenue 78,564 $113,000,000 For Sale $1,438.32
21-23 West 26th Street 18,171 $19,000,000 For Sale $1,045.62 Historic portfolio
LEASEHOLD TRANSACTIONS
3 East 44th Street 14,175 $15,300,000 August-19 $1,079.37
16661
LEXINGTON
COMPARABLES MIDTOWN, NEW YORK
OFFICE COMPS
ADDRESS BLDG SF DATE PPSF
570 Lexington Avenue 5,436 March-21 $70.00
133 East 58th Street 1,354 February-21 $72.00
145 East 57th Street 4,285 July-20 $70.00
485 Lexington Avenue 54,199 March-20 $67.00
641 Lexington Avenue 6,691 December-20 $65.00
139 East 57th Street 1,048 January-21 $60.00
770 Lexington Avenue 500 June-21 $66.00
515 Madison Avenue 9,469 December-20 $65.00
641 Lexington Avenue 30,485 December-20 $65.00
570 Lexington Avenue 18,668 September-20 $66.00
TOTAL/AVERAGE 132,135 $66.60
RETAIL COMPS
ADDRESS BLDG SF DATE PPSF
707 Lexington Avenue 6,428 June-20 $160
715 Lexington Avenue 3,000 March-21 $112
136-140 East 55th Street 980 June-19 $200
TOTAL/AVERAGE 10,408 $157.33
17DISCLAIMER
The information contained in this Investment Offering is confidential and is provided for
the sole purpose of allowing persons to evaluate whether there is interest in proceeding
with further discussions regarding a possible transaction with respect to the subject
property (the “Property”). The information contained herein shall not be photocopied or
disclosed to any other party and shall not be used for any other purpose. If the person
receiving this Offering Memorandum does not choose to pursue such a transaction, this
Offering Memorandum shall be returned to Lee & Associates.
Neither the Owner, nor Lee & Associates, nor any of their officers, directors, employees
or agents, assume any responsibility or make any representations or warranties, whether
express or implied, by operation of law or otherwise, with respect to the Property
or this Offering Memorandum or any information or statements (including financial
statements and projections) contained herein or relating hereto, including the accuracy
or completeness of such information or statements and the condition, quality or fitness
of the Property. Such information and statements have in many circumstances been
obtained from outside sources, have not been tested or verified and may be subject
to errors or omissions. Projections, in particular, are based on various assumptions and
subjective determinations as to which no guaranty or assurance can be given. Potential
investors are urged to perform their own examination and inspection of the Property and
information relating to same, and shall rely solely on such examination and investigation
and not on this Offering Memorandum or any information or materials contained herein
or otherwise provided.
Lee & Associates is the exclusive advisor and representative of Owner and no agency
agreement, express or implied, shall exist between Lee & Associates and potential
purchasers, unless otherwise agreed to in writing by all parties. The only party authorized
to represent the Owner of the Property is Lee & Associates, and the Owner shall not be
obligated to pay any fees or commissions to any other advisor, broker or representative.
Any party entering into a transaction with the Owner shall be obligated to pay any
fees or commissions due any advisors, brokers or representatives, other than Lee &
Associates, dealing with such party.
This Offering Memorandum is provided subject to prior sale or lease, change of price or
terms and other changes to the materials, statements and information contained herein
or relating to the Property, and is subject to withdrawal, all without notice or any liability.
In no event shall the delivery or receipt of this Offering Memorandum be deemed to
create any legal obligation to enter into any transactions with respect to the Property,
and only a definitive agreement signed by all parties shall create a binding commitment
to enter into a transaction.
18661
LEXINGTON
MIDTOWN, NEW YORK
FOR MORE INFORMATION, PLEASE CONTACT:
BEN TAPPER CHRIS VARJAN
Senior Managing Director Senior Managing Director
646.658.7334 212.776.1272
btapper@lee-associates.com cvarjan@lee-associates.com
SEAN SLATTERY KYLE WILLIAMS
Director Director
646.723.4011 646.723.4715
sslattery@lee-associates.com kwilliams@lee-associates.com
JONATHAN BRAUN GEORGE STEFFANI
Director Director
212.776.4341 212.776.1207
jbraun@lee-associates.com gsteffani@lee-associates.com
SCOTT MULLIGAN
Associate
212.776.4340
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