Dumbo flying light
Two Trees wins via small deals in old buildings
OFFICE-
space creation is rampant along and near the Brooklyn waterfront.
While brand-new projects command lots of attention, the Walentas family’s Two Trees Management is enjoying a banner leasing year at three Dumbo buildings it has owned for 40 years.
Two Trees’ 45 Main St., 55 Washington St. and 20 Jay St., near the base of the Manhattan Bridge, with a total 1.255 million square feet, have quietly seen 288,000 square feet of activity in 2017, including newly signed leases, expansions and renewals.
In addition, talks are ongoing for 47,000 square feet more. Two Trees’ Dumbo holdings include more than 3 million square feet of space, much of it residential.
Although a 50,000square-foot relocation from Manhattan to 55 Washington St. signed in March by architect Bjarke Ingels was widely reported, the more-meaningful news about the Two Trees complex is that the vast majority of other new deals were very small — many under 5,000 square feet.
“From Day One, our bread and butter was small spaces,” said Two Trees principal Jed Walentas. “It’s a totally different business model from bringing in a 100,000-square-foot tenant.”
He also said that “we invested tens of millions of dollars in new infrastructure” for the old industrial properties, and they appeal to firms other landlords might regard as too small to bother with.
“We think of our properties as incubators,” Walentas said. Some tenants stay, while others move on.
His Dumbo portfolio is especially popular with tenants in the creative, tech and media fields. This year’s arrivals include Slingshot VR, a virtual and augmented reality firm, which took 3,000 square feet at 20 Jay St., and travel-focused digital-content firm Passion Passport, which leased a mere 857 square feet at 55 Washington.
Tenant amenities include roof-decks on all three buildings designed by High Line vets James Corner Field Operations.
Besides accommodating smaller tenants than many landlords are willing to, Two Trees offers shorterterm leases at the three buildings than are usually available elsewhere. “Early-stage companies are growing a ton, but neither they nor we know where they’ll be in five years,” Walentas said.
“Our asking rents are generally in the $40s to low $50s,” he said. It’s reason- able by today’s standards, but a lot more than when Two Trees acquired the buildings in the 1970s. At the time, the properties still being used for manufacturing and warehousing fetched as little as $1 to $2 a square foot.
Hong Kong-based investor Goodwin Gaw snatched up the High Linestraddling Standard Hotel for even less than the dramatically discounted price The Post first predicted last summer.
Gaw paid only $323.2 million for the revenue-sliding hotel, according to NYC Department of Finance re- cords. That’s shy of the $340 million we forecast in an Aug. 8 story that revealed Gaw’s intention to buy the property. We noted at the time that an aborted deal with a different prospective buyer in 2014 would have fetched $400 million.
Gaw Capital Partners purchased the Standard from Dune Capital Management and Greenfield Partners. The bargain price for the Standard reflects saturation in the Gotham hotel market and reduced occupancy and revenue per available room. BT Americas, a global telecommunications com- pany, is the newest office tenant at SJP Properties’ 11 Times Square. The firm signed a lease for 14,200 square feet in one of the few available spaces in the tower, which boasts 1.1 million square feet.
The tenant is moving from the New York Times building across the street. Asking rents at 11 Times Square start in the $90s per square foot.
BT Americas was repped by Colliers International’s
Robert Tunis, Eric Ferriello and Patrick Wilcox. SJP was repped by JLL’s Paul Glickman and Diana Biasotti. scuozzo@nypost.com