Israeli income producing property company Property and Building Corp. Ltd. (TASE:PTBL) has notified the Tel Aviv Stock Exchange (TASE) that it is in talks to lease out 330,000 square feet (30,600 square meters) in New York City’s 10 Bryant Park, known as HSBC Tower. According to US media reports the negotiations are with tech giant Amazon, which would replace the current anchor tenant HSBC, which is vacating 10 floors in the building. Property and Building’s share price jumped 9% on the news.
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10 Bryant Park, or HSBC Tower is a three building complex including a 30-floor office tower with an overall 80,000 square meters of space, mainly offices, on New York City’s Fifth Avenue, next to Bryant Park.
In its TASE notification, Property & Building reported, “The company is conducting negotiations with a leading international company on unbinding principles of understanding to lease 330,000 square feet, which is currently leased to HSBC, with an option to expand the space rented to the international corporation for the long term.” Property & Building added that there is no certainty that the talks with mature into a binding agreement or that a lease agreement will be signed.
The value of the property has fallen in recent years
According to an investors’ presentation in September, the occupancy of the property is currently 98%, while HSBC Bank, which is a significant tenant, announced about two years ago that it will leave the tower and is expected to vacate the premises in April 2025. It is an anchor tenant that accounts for 61% of the income of the income producing property. Also, the bank rents safe rooms in the building and has extended the agreement in the basements until July 2030.
Property and Building has been trying to sell the tower in recent years without success, during which the value of the property has fallen, so that it is currently worth $650 million, compared with $855 million at the end of 2021.
Tech giant Amazon already has offices on Fifth Avenue in Manhattan, New York, not far from the tower, in what used to be the flagship department store of the Lord & Taylor chain.
Published by Globes, Israel business news – en.globes.co.il – on October 31, 2024.
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