Weekly Market Report - March 31, 2026
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The JACX property, completed in mid-2019, had Macy's lease 600,000 square feet, but due to the pandemic, Macy's did not occupy the space, continuing to pay rent of about $50 per square foot. Much of the leased area remains unoccupied and available for sublet. WeWork vacated 20% of the space during its bankruptcy, which is now leased to a different co-working firm owned by the developer, Tishman Speyer. The property's $425 million mortgage was moved to special servicing due to the high amount of unoccupied space, complicating refinancing efforts. Tishman Speyer requested this transition to negotiate a loan extension, asserting it would not affect customer operations. Recently, lenders are expected to require additional cash investment from Tishman Speyer for the extension. The firm faced similar challenges with its 300 Park property, which also moved into special servicing, but successfully managed subsequent refinancing.
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The landmarked Midtown office building at 390 Fifth Ave., owned by Fred and Robert Schwalbe, is facing foreclosure after defaulting on $47 million in debt. The Schwalbes accused lender Maverick Real Estate Partners of violating an agreement to extend the mortgage and seizing rental revenue, leading to financial distress. In a court hearing, they sought an injunction from Judge Jennifer Schechter to prevent foreclosure, claiming it would harm their business. However, she denied their request, citing insufficient evidence of "irreparable harm." This decision paves the way for Maverick to initiate foreclosure proceedings on the 140,000-square-foot property, which is currently 20% vacant. The Schwalbe family, which has invested in New York real estate since 1944, also owns other Midtown buildings that have faced foreclosure recently. Maverick is known for its aggressive tactics with delinquent property owners and argued that the Schwalbes did not meet the necessary conditions for a loan extension.
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Uber Technologies is expanding its New York offices, now the largest outside San Francisco, reflecting the city's increasing significance post-CEO Dara Khosrowshahi's relocation. The workforce has risen to over 2,000 employees, prompting an expansion in 3 World Trade Center to 11 floors, totaling nearly 500,000 square feet, along with rentals in a co-working space. Prior desk shortages necessitated close packing of employees. A three-day office mandate has further driven growth since June, with remote work approvals reduced for employees living within 50 miles of an office. Comparatively, California staffing has remained flat. Growth in New York is strongest in managerial, sales, and marketing roles, while employee numbers in other states declined. Uber plans further workforce expansion, asserting NYC's centrality to its future. Additionally, it is investing $7 million in local education and cultural initiatives, emphasizing the city's robust talent pool and opportunities for growth.
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Vornado Realty Trust is expanding its apartment tower project near Penn Station by acquiring nearby properties, including a McDonald’s for $12 million. The McDonald’s, a single-story building, was built in 1975 and has been part of the area since 1987. The fast-food restaurant is expected to remain as a tenant in Vornado’s development. Additionally, Vornado purchased air rights from adjacent properties, acquiring 66,000 square feet from two nearby locations. This move complements Vornado’s plans to build a 475-unit tower at the corner of Eighth Avenue and West 34th Street.
The site could accommodate a 325-foot spire, potentially taller with affordable housing inclusion. Vornado began purchasing sites at this location in 2015, transforming what were once modest buildings into a large-scale development project. The new McDonald’s has faced issues with rowdiness and crime, but the chain remains stable in New York City, maintaining around 189 locations since 2022. Vornado is known for its office buildings and high-end residential developments in the area, positioning itself as a major player in the Penn Station neighborhood.
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A judge has dismissed most claims against Michael Shvo by Core Club, alleging fraud. This ruling is favorable for Shvo amidst an ongoing legal dispute with the members-only club since 2024. Core Club's complaint, filed by co-founders Jennie and Dangene Enterprise, accused Shvo of deceit to monopolize control. Shvo had proposed a $100M investment for Core’s expansion and later entered into a deal involving a $1M loan and an option for a 50% stake. Core claimed Shvo failed in delivering quality work and meeting deadlines. Justice Andrea Masley dismissed 13 claims, including fraud, citing contradictions in Core's arguments. Remaining claims focus on contractual issues and an allegation of an $80K unpaid tab. Core intends to amend its complaint to include racketeering. Shvo's team argues the lawsuit is to evade unpaid debts, as Core allegedly defaults on over $3.5M in rent. Both sides continue to contest allegations of financial misconduct.
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Delmonico’s, a Wall Street area fixture, is preparing to open a second outpost despite the rapidly rising price of beef
Delmonico’s, established in 1837 near Wall Street, thrived during financial turmoil and has since served notable figures like Abraham Lincoln and Mark Twain. Almost 200 years later, it plans to open a second location in Midtown Manhattan next year. Despite rising beef prices due to shrinking cattle herds and import tariffs, Americans' continued preference for steak is evident. Sales at U.S. steak-chain restaurants increased over 5% last year, outpacing growth in full-service dining overall, with casual chains like Texas Roadhouse leading the charge. Steak frites remain a reliable option, particularly in New York, where diners often pair red meat with alcohol.
Delmonico’s primarily caters to business executives, offering a 36-ounce porterhouse steak for $210. Its new Midtown location will feature private rooms for corporate gatherings and aims to attract the power-lunch clientele. The original Beaver Street restaurant, recently renovated, showcases its rich history through decor. Executive Chef Adam Plitt, previously at Le Bernardin, is modernizing the menu with additional fish offerings. Newmark negotiated the lease for the new venue, positioning Delmonico’s to blend tradition with contemporary dining.
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Controversial nursing home owner Daryl Hagler has sold five facilities in the Bronx and Brooklyn for $332 million, following a multimillion-dollar fine for fraud and neglect. The properties, sold on March 13, were acquired by various shell companies linked to a buyer identified as the Emerald Group, led by CEO Chuny Herzka. The transaction reflects a strategic diversification of Hagler's portfolio, according to a Centers Health Care spokesman. The highest-profile sale was the Boro Park Center for Rehabilitation and Healthcare, sold for $161.5 million.
Additional properties included Williamsbridge Center for $9.5 million, Bruckner Nursing Home for $26.4 million, Brooklyn Center for $73.5 million, and Bushwick Center for $61.3 million. In June 2023, New York Attorney General Letitia James filed a lawsuit against Hagler and co-founder Kenneth Rozenberg for alleged financial misconduct and neglectful conditions. A settlement in November 2024 resulted in a $45 million fine, with funds designated for improving care. A monitor was appointed to oversee the facilities' finances. The sales did not include properties with documented neglect issues as part of the settlement agreement.
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The Chetrit Group plans to demolish a 5-story mixed-use building at 9 E. 36th St. in Midtown South, having filed permits with the city for the project, projected to cost $500,000. Vincent Chanona is the property owner and Moses Seidenfeld from Avalon Designs Inc. is the architect. The Chetrit Group, which owns over 16 million square feet of real estate, has been selling off its New York properties, including a Jamaica site for $17 million and a Woodside site for $18.6 million. Court records indicate that the group is dealing with foreclosures totaling $1.6 billion in defaulted debt, and legal troubles include felony charges for tenant harassment against Meyer Chetrit.
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Luxury gym Hydrogen Fitness will open in New York City in January, occupying a 25,000-square-foot space at 145 E. 32nd St. in Murray Hill. The facility spans multiple levels of a 13-story building and will operate 24/7, featuring amenities like a 24-hour juice bar, sauna, and steam rooms. Founded by Jonathan Gutwein and Andrew Pinon in 2020, it currently has two locations in Westchester County. Memberships start at $149 per month, with a super-plus option at $219. The 15-year lease had an asking rent of $70 per square foot. This lease is noted as the largest retail deal in the neighborhood in recent years.
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The closure of the Tin Building food hall at South Street Seaport, which incurred millions in losses, disappointed owner Jean-Georges Vongerichten and Seaport Entertainment Group. Conversely, the Bryant Park Grill, a highly successful restaurant, is using this setback to push back against Bryant Park management's decision not to renew its lease. The management aims to replace the grill with a newer, upscale location under Jean-Georges, having branded the current operation as “tired.” Bryant Park Grill filed a lawsuit claiming the selection process for its replacement was unfair, while the park countered with a lawsuit for lease violations.
Despite ongoing legal issues, the grill continues to operate. The restaurant has generated significant sales, with a yearly volume of $26 million, raising concerns among park officials about replacing a financial success. Executive Director Dan Biederman believes a new establishment could yield even greater revenue. Discussions around the grill’s succession raised doubts, particularly regarding the owner’s age. Meanwhile, the library system’s involvement added complexity, alongside an internal spat reflected in a leaked email. As the Bryant Park Grill remains financially robust, the future of the space hangs in uncertainty amid the culinary and real estate tug-of-war.
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A new jazz club named The Pocket is set to open in mid-May at The Muse New York, located at 130 W. 46th St. The venue will span 4,000 square feet, providing 170 seats. Led by music veterans Grant Gardner, former general manager at the closed Jazz Standard, and Martin Porter, a programmer for Jazz at Lincoln Center, The Pocket aims to capture the intimate vibe of 1940s and 50s jazz rooms on 52nd Street. The opening lineup features Grammy winners like Wynton Marsalis and Cecile McLorin Salvant. The club will also serve food and beverages. The lease is for 15 years with a renewal option for five years at a monthly rent of $30,000. The landlords were represented by Vantage Real Estate Advisors, while Murro Realty represented The Pocket. Gardner and Porter expressed excitement about contributing to the revitalized jazz scene post-Covid and highlighted Midtown's accessibility for a diverse audience.
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CIM Group has sold a distressed office building at 88 University Place, Greenwich Village, for $46 million, two years after acquiring it for nearly $49 million through foreclosure. The buyer, a partnership between Acram Group and Bulldog Real Estate Partners, plans significant renovations, including upgrades to common areas and new pre-built office suites. The 11-story, 71,000-square-foot property features a Thai restaurant on the ground floor and the third floor occupied by a real estate brokerage, while the remaining floors are mostly vacant. Acram, previously JMC Holdings, manages over 4 million square feet of real estate across the U.S. and recently purchased another Greenwich Village retail condo for $21 million. CIM, meanwhile, is focused on other developments, including a mixed-use project in Brooklyn, transforming a site once occupied by Jehovah’s Witnesses. The reason for the sale remains unclear, and CIM did not provide comments.
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