Sublease deal works for firm.

Even for a firm used to doling out oodles of cash, Cramer Rosenthal McGlynn was hit with a stiff case of sticker shock when it learned of the stratospheric rent hike it would have to pay to remain in its current space at 520 Madison, where its lease was scheduled to expire next year.

Occupying the entire 32nd floor in the Tishman Speyer owned tower, the firm, which provides asset management services to high net worth individuals and institutional investors, was told it would have to pay $150 per s/f to renew its lease, a rate at the top end of the remarkable rates that landlords have been able to command in the current booming market.

But the firm didn't have to slink in search of more affordable space like many firms in its position have had to do in midtown especially, where rents are teetering on the brink of record levels.

Instead, Cramer Rosenthal McGlynn's broker, Kenneth Rapp of CB Richard Ellis, negotiated a 22,390 s/f sublease of the entire 20th floor from Jefferies & Company, one of five floors the investment services firm had leased in an expansion in the building last year.

Rents for the space start at $88 per s/f for the first five years of the ten-year deal and then increase to $95 per s/f after that. The move will also give Cramer Rosenthal McGlynn an opportunity to reconfigure the layout of its offices because the space it will be moving into is blank and needs to be built out.

Cushman & Wakefield's Dale F. Schlather represented Jefferies in the transaction.