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Hidrock signs two deals at 35 West 36th Street

Hidrock Realty has signed two new tenants at 35 West 36th Street – an interactive
marketer and apparel manufacturer – in transactions that may presage the direction
of the area.

React2Media, a boutique interactive marketing agency, has signed a seven-year, 3,420-square-foot-deal at the fashion district building, expanding from its previous location in Chelsea. Marilyn Kane of Nichols Kane Realty represented the tenant in the transaction. Asking rent for the space was $34 per square foot in both transactions.

React2Media and The Apparel Maker have moved into 5,860 square feet
at Hidrock’s 35 West 36th Street building

React2Media, a full-service boutique agency specializing in interactive marketing
opportunities for publishers and online advertisers, has signed a seven-year,
3,420-square-foot deal at 35 West 36th St. The company expanded from its
previous location in Chelsea. Robert Kaplan, director of leasing at Hidrock Realty,
represented the landlord, 3536 Associates, LLC, an affiliate of Hidrock Realty,
while Marilyn Kane of Nichols Kane Realty represented the tenant in the
transaction. Asking rent for the space was $34 per-square-foot.

The Apparel Maker has signed a five-year, 2,400-square-foot lease for its first
New York City location. Robert Kaplan of Hidrock Realty represented the tenant
and the landlord, 3536 Associates, LLC an affiliate of Hidrock Realty, in the
transaction. Asking rent was $34 per-square-foot.

Hidrock Realty is completing custom build-outs for both companies, such as
refinishing the building’s 100-year-old maple floors and exposing original brick
walls for The Apparel Maker. Both tenants will receive turn-key designs for their
new spaces, including brand new kitchens and private bathrooms.

Featuring Abraham Hidary on reducing costs and offering tenant incentives

“You need to work harder, but more importantly, you need to work smarter,” says Daniel Blanco, the COO and co-principal of Broad Street Development. “When the market is bad, you got to respond. Be smart: if there’s less money to spend you drop rents – it’s pretty simple.”

While Mr. Blanco’s instruction seems to be a simple one based on simple logic, he is apparently preaching a gospel perhaps germaine to smaller-scale commercial landlords like himself. They have to pivot quicker when it comes to rents and tenant incentives, operating as they do among giants like SL Green and Vornado, which literally tower
above them.

The unexpected fast recovery in the Manhattan hotel market has spurred developers
such as Sam Chang and Hidrock Realty to dust off once-stalled projects or start new
ones as room rates and occupancy levels have grown over the last year.

“We are seeing renewed interest in projects that have been stalled,” hotel consultant
John Fox, a senior vice president at Colliers PKF Consulting, said. “Despite significant
additions to the supply of rooms over the past few years, occupancies are at levels
approximating those before the declines that started in September 2008.”

Hidrock has sold 29 E. 61st St., the five-story location now home to Serafina, to
an unidentified buyer for $21 million, or $1,250 a square foot – yielding a 3.8 percent
cap rate on existing rents, said Massey Knakal’s Guthrie Garvin, who brokered the
deal with Jeffrey A. Shalom.

Hidrock succeeds in buying 960 Sixth Avenue “the new way”

Late last month, Hidrock Realty Inc. took control of a 16-story office building at 960 Sixth Ave. the new way – buying up a distressed mortgage at a discount and then foreclosing the borrower.

It may sound simple, but it’s not. In fact, hundreds of real estate investors are trying to duplicate the success achieved by Hidrock and a few others but are struggling to overcome a series of unexpectedly high barriers.

Contrary to widespread forecasts, few distressed mortgages have come up for sale, and the limited supply has driven up prices. Additionally, there is very little public information on the properties that the mortgages are financing, and foreclosing an owner can mean years of expensive legal wrangling.

Hidrock to build it’s first Manhattan hotel at 960 Sixth Avenue

Hidrock Realty, a family owned real estate investment company, is planning to embark
on what appears to be a pretty gutsy move: develop its first Manhattan hotel in a market
that’s recovering but still far from robust.

But Hidrock is able to move forward with some confidence because of the enormous
discount it just got on a near-empty office building near Herald Square which it plans to
convert into a hotel. Hidrock paid about $40 million for the 100,000-square-foot building
at 960 Sixth Ave., less than half of the $105 million the former owner paid for the
property in 2007.

Abraham Hidary’s Hidrock Realty won the 100,000-square-foot office property at 960 Sixth Avenue in Herald Square this week in a long-expected foreclosure auction nearly eight months after his company bought a defaulted senior mortgage on the property for about $40 million.

According to Hidrock Realty Inc., a grand opening of Aroma Cafe was recently celebrated, under a new, approximately 4,000 square foot lease at 35 West 36th St.

The tenant’s build-out of the space features hardwood floors, a mixture of pendant and recessed lighting, lofted ceilings, an ADA-compliant bathroom, and a sushi bar to support the restaurant’s quick and convenient, market-like offerings of kosher pizza, sushi and falafel, as well as other menu items.

Tenants are still at the wheel, so how can landlords be successful? We turned to Hidrock Realty prez Abie Hidary, whose firm owns and manages eight buildings in NYC, as well as assets in Brooklyn, South Florida and Pennsylvania. The key, he says: be “very good” to the brokerage community – be upfront, pay them in a timely manner, build quality space quickly, and keep lease documents to the point. Hidrock has also ramped up marketing, with leasing director Robert Kaplan taking small groups on private building tours, allowing the firm to build more personal relationships and introduce “uptown” brokers to affordable quality space around Bryant Park and Penn Plaza.