New home for menswear industry takes shape.

In a highly complex transaction that will ensure that New York City remains the center of the multi-billion dollar menswear apparel industry, 47 manufacturers, importers and distributors have signed leases committing them to relocate their headquarters and executive offices to 1350 Avenue of the Americas in Manhattan.

Based on the lease transactions, which total 170,000 square feet, the Minskoff Organization, the owner of the building, has refinanced the mortgage on the 600,000 square-foot, 35-story property, which is located between 54th and 55th Streets. The company is also planning to rename it the Men's Apparel Building.

The tenants, all of whom are primarily from 1290 Avenue of the Americas, represent a virtual who's who of menswear label licensees, including Burberrys, Gian Franco, Geoffrey Beene, Jones of New York, Albert Nippon, Chaps, Polo, Nino Cerruti, Adolpho, JG Hook, and Stanley Blacker. Each company will occupy from 1,000 to 30,000 square feet on 14 full floors.

A committee representing the moving tenants and a number of other menswear companies still housed at 1290 Avenue of the Americas said that more such firms would be signing on for space at 1350 as their current leases expire.

Norman S. Jacobson, president of Mitchell Special Services Corporation, the leasing and management affiliate of Edward J. MinskoffEquities, Inc. and the exclusive leasing and management agent for 1350 Avenue of the Americas, negotiated all 47 of the leases, which have 10-year terms with two five-year options.

The tenants were represented by Norman Feinberg, president of Mannor Corporation and head of the special ad hoc committee for the men's apparel tenants at 1290 Avenue of the Americas. Other members of the committee included Ronnie Wurtzburger of Peerless Clothing, Jeff Weintraub of George Weint and Company, and Sheldon Brody of Marcraft.

"The future of the menswear industry is now secure in New York City," said Feinberg, noting that numerous tenants at 1290 Avenue of the Americas has been exploring the idea of leaving Manhattan before the deal at 1350 came through. "New York has always been the center of the men's apparel industry and we needed a central Midtown location attractive to buyers."

"This is a wonderful deal for New York City, 1350 Avenue of the Americas and the menswear industry," said Jacobson. "Negotiations for 47 separate leases were simplified by the industry's commitment to a central location and the tenants' enthusiastic cooperation."

According to Feinberg, the tenants initially negotiated with Olympia & York, the owner of 1290 Avenue of the Americas. The building had housed the menswear tenants since 1965, but the industry had outgrown the approximately 130,000 square feet of space it occupied, and leases were due to begin expiring in October, 1994.

As a "small fish" in this two-million square foot "pond," the companies encountered price and space constraints that prevented the menswear industry from remaining. With the clock ticking on lease expirations and tenants seeking space in a variety of places, including Fifth Avenue, Seventh Avenue, Connecticut and New Jersey, it seemed as though the tradition of a showroom building in New York City was in danger.

Feinberg suggested that the group pool its resources to create an affordable, new showroom building, and volunteered to head the ad hoc committee.

After approaching The Minskoff Organization about space in its building, Feinberg began discussions with Jacobson about 1350 Avenue of the Americas, the former MGM building.

Feinberg and Jacobson approached the problem of negotiating separate leases by hammering out a master lease that was presented to the menswear tenants at the meeting on April 7th. As Jacobson and the ad hoc committee held their collective breath, the tenants - by a show of hands - unanimously agreed to the lease terms.

According to both men, the terms of the master lease, which required each company to sign a separate lease, were fair for both the tenants and the owner. However, the deal hinged on several non-negotiable points.

Feinberg insisted that the menswear companies occupy 1350's tower floors, have a building identity and that Mitchell Special Services offer a work-letter covering all capital improvements.

In order to agree, the ownership needed to obtain refinancing that would cover the cost of building the space, performing renovations and providing extra security. The Bank of New York agreed to provide refinancing as long as the menswear industry signed leases for a minimum of 129,000 square feet of space.

To accommodate the menswear industry, Jacobson relocated a total of five full floors of space at 1350 Avenue of the Americas and moved the William Morris Agency to 1325 Avenue of the Americas.

According to Feinberg, the master lease offered rents of $28 per rentable square foot, including all common space and security, $1.60 per square foot of electrical inclusion and real estate taxes of $7 per square foot.

Offices will be delivered to tenants on a turnkey basis, including glass doors, new carpeting, wall-coverings, and all renovation and building costs. Tenants will receive a $15 per square-foot work-letter allowance for additional decorating expenses, and the owner is supplying tenants with architectural services at no charge.

In addition, every tenant will have a strong identity off the main elevator bank regardless of its floor or office size. In addition, the building's 35th floor will house conference facilities, an exercise room and a reception area for tenants and retailers.

Mitchell Special Services expects the vast majority of the menswear apparel industry, which currently occupies 450,000 square feet of space in New York City, to relocate to 1350 Avenue of the Americas as current leases expire and room is made available for them. In addition to the tenants at 1290, companies will begin moving in March, 1995 from 135 West 50th Street, The Empire State Building, One West 34th Street, 390 Fifth Avenue and Rockefeller Center.