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Report: Bloomberg agrees to Lexington Ave. tower.

If it happens, it will tower almost 1,000 feet above midtown and straddle one of Manhattan's most contested cavities. Bloomberg has, in theory, agreed to anchor the proposed 75-story, 1.3 million square foot tower on the old Alexander's department store site at 59th street and Lexington Avenue. Vornado Realty proposed the tower, which will combine office space, high-end retail stores, a luxury hotel and approximately 200 condominiums.

On Sept. 21 The New York Times reported there "was a breakthrough at a meeting" in recent days between Vornado and Bloomberg. The news couldn't come at a better moment for the city's real estate market.

Wendy Kopsick, a spokesman for Vornado Realty Trust, declined to comment on the deal.

Despite the silence on both sides, the news is causing a stir throughout the real estate industry in Manhattan.

"I've had three clients ask me what's going into that hole in the ground," said Steve Perlo, Vice President of the Corcoran Group. "This is a superb location for a retail anchor. There's a ton of demand supporting every area in this proposal."

Another insider believes the anchor tenant might be someone new on the block.

"I think, given the location, the retail anchor will be someone new, possibly a retailer who isn't in New York yet," said Faith Hope Consolo, Vice Chairman of Garrick-Aug Associates Inc. Consolo added that. "we've been waiting with baited breath for this to come along." Though the breakdown of retail/residential/office space remains to be determined, the prospects are extremely optimistic across the board. The outlook for office space couldn't be better.

"I see the potential for a foreign bank as another tenant here," said Robert Billingsley, the Executive President of Coliers ABR. "The rents will be outrageous, of course, but you have to remember that this is the only big building being proposed in that area. And that is a very strategic area." Billingsley cited the proposed tower's location, "walking distance from the decision makers on the east side," as another selling point. He also sees Bloomberg's potential move as an affirmation of the company's dominance.

The history of this vacant lot on 59th street dates back to 1991 when Alexander's was bought by Steve Roth of Vornado. Roth negotiated with Sotheby's for two years when the auction house was looking to move. But Roth turned the tables on Sotheby's by courting Christies instead (Christies subsequently moved to Rockefeller Center). Then came a round of negotiations with Bloomberg, at which point Roth hired the fourth architect to work on the dormant project. Since he began talks with the market data giant, developments went sluggish as both sides tried to agree on a deal. Then this past June, Roth raised the stakes by sending Bloomberg an ultimatum: accept the deal or forget it. Roth filed plans with the City Buildings Department last summer which apparently gave Bloomberg only four flors of office space versus the six that they apparently required. The news reported in the Times on September 19 gives new reason to think that a deal is imminent.
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Title Annotation:Vornado Realty Trust building gets Bloomberg Companies tenat
Publication:Real Estate Weekly
Article Type:Brief Article
Geographic Code:1USA
Date:Sep 27, 2000
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