Item 2. Properties
ITEM 2. PROPERTIES
The following table shows the location, ownership, approximate size (excluding parking garages) and occupancy of each of our properties as of December 31, 2020.
Square Feet Weighted
Under Average
Development Or In Service Escalated Lease Expiration(s)
Land Total Not Available Occupancy Annual Original Option
Property Acreage Property In Service For Lease Rate Rent PSF (1)
Tenants Term (2)
Term (3)
Operating Properties:
731 Lexington Avenue
New York, NY
Office 920,000 920,000 — 100% $130.00 Bloomberg L.P. 2029 2039
Retail 83,000 83,000 — The Home Depot 2025 2035
34,000 34,000 — The Container Store 2021 N/A
38,000 38,000 — Various Various Various
155,000 155,000 — 93% 278.46
1.9 1,075,000 1,075,000 —
Rego Park I
Queens, NY
112,000 112,000 — IKEA 2025 (4) 2030
50,000 50,000 — Burlington 2027 N/A
46,000 46,000 — Bed Bath & Beyond 2026 N/A
36,000 36,000 — Marshalls 2032 N/A
16,000 16,000 — Old Navy 2022 N/A
78,000 — 78,000 (5) N/A N/A
4.8 338,000 260,000 78,000 100% 53.58
Rego Park II
Queens, NY
145,000 145,000 — Costco 2034 2059
135,000 135,000 — Century 21 (6)
2031 2051
133,000 133,000 — Kohl’s (7)
2031 2051
196,000 196,000 — Various Various Various
6.6 609,000 609,000 — 96% 59.73
The Alexander apartment tower, 312 units
Queens, NY — 255,000 255,000 — 82% 46.26 (8)
Residential (9) N/A
Paramus
Paramus, NJ 30.3 — — — 100% — IKEA (ground lessee) 2041 (10) N/A
Flushing
Queens, NY (11)
1 167,000 167,000 — 100% 32.09 New World Mall LLC 2027 2037
Property to be Developed:
Rego Park III, adjacent to Rego Park II
Queens, NY 3.2 — — — — — — — —
2,444,000 2,366,000 78,000
(1) Represents the weighted average escalated annual rent per square foot, which includes tenant reimbursements and excludes the impact of tenant concessions (such as free rent), as of December 31, 2020. For a discussion of our leasing activity, see Item 7 - Overview - Square Footage, Occupancy and Leasing Activity.
(2) Represents the year in which the tenant’s lease expires, without consideration of any renewal or extension options. Lease expiration dates are based on non-cancelable lease terms and do not extend beyond any early termination rights that the tenant may have under its lease.
(3) Represents the year in which the tenant’s lease expires if all renewal or extension options are exercised.
(4) IKEA has the option to terminate its lease after the fifth year of the lease term subject to payment to us of the lesser of $10,000,000 or the amount of rent due under the remaining term.
(5) Formerly occupied by Sears. Currently out of service due to redevelopment.
(6) On September 10, 2020, Century 21 filed for Chapter 11 bankruptcy and closed its store on December 7, 2020.
(7) Subleased through remaining original lease term.
(8) Average monthly rent per unit is $3,212.
(9) Residential tenants have one or two year leases.
(10) IKEA’s lease has a purchase option in October 2021.
(11) Ground leased through January 2027 with one 10-year extension option.
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Operating Properties
731 Lexington Avenue
731 Lexington Avenue, a 1,323,000 square foot multi-use building, comprises the entire block bounded by Lexington Avenue, East 59 th Street, Third Avenue and East 58 th Street in Manhattan, New York, and is situated in the heart of one of Manhattan’s busiest business and shopping districts, with convenient access to several subway and bus lines. The property is located across the street from Bloomingdale’s flagship store and only a few blocks away from Fifth Avenue and 57 th Street. The building contains 920,000 and 155,000 of net rentable square feet of office and retail space, respectively, which we own, and 248,000 square feet of residential space consisting of 105 condominium units, which we sold. Bloomberg occupies all of the office space. The Home Depot (83,000 square feet) is the principal retail tenant.
The office portion of 731 Lexington Avenue is encumbered by a mortgage loan with a balance of $500,000,000 which matures in June 2021, with three one-year unilateral extension options. The interest-only loan is at LIBOR plus 0.90% (1.06% as of December 31, 2020). In connection therewith, we purchased an interest rate cap with a notional amount of $500,000,000 that caps LIBOR at a rate of 6.0%.
The retail portion of 731 Lexington Avenue is encumbered by a mortgage loan with a balance of $300,000,000 which matures in August 2025. The interest-only loan is at LIBOR plus 1.40% (1.55% as of December 31, 2020) which is subject to an interest rate swap with a fixed rate of 1.72%.
Rego Park I
Rego Park I, a 338,000 square foot shopping center, located on Queens Boulevard and 63 rd Road in Queens, New York. The center is anchored by a 112,000 square foot IKEA, a 50,000 square foot Burlington, a 46,000 square foot Bed Bath & Beyond and a 36,000 square foot Marshalls. The center contains a parking deck (1,241 spaces) that provides for paid parking.
Rego Park II
Rego Park II, a 609,000 square foot shopping center, adjacent to the Rego Park I shopping center in Queens, New York. The center is anchored by a 145,000 square foot Costco and a 133,000 square foot Kohl’s, which has been subleased. On September 10, 2020, Century 21 ($6,400,000 of annual revenue) filed for Chapter 11 bankruptcy and closed its 135,000 square foot store on December 7, 2020. The center contains a parking deck (1,326 spaces) that provides for paid parking.
This center is encumbered by a mortgage loan in the amount of $252,544,000 which matures in December 2025. The interest-only loan is at LIBOR plus 1.35% (1.50% as of December 31, 2020). As of December 31, 2020, we have a participation in the mortgage in the amount of $50,000,000 which for GAAP purposes is netted against the mortgage balance. Therefore, the balance sheet amount of the mortgage loan is $202,544,000.
The Alexander Apartment Tower
The Alexander apartment tower, located above our Rego Park II shopping center, contains 312 units aggregating 255,000 square feet.
The property is encumbered by a mortgage loan in the amount of $94,000,000 which matures in November 2027. The interest-only loan has a fixed rate of 2.63%.
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Operating Properties - continued
Paramus
We own 30.3 acres of land located at the intersection of Routes 4 and 17 in Paramus, New Jersey. The land is located directly across from the Garden State Plaza regional shopping mall and is within two miles of three other regional shopping malls and ten miles of New York City. The land has been ground leased to IKEA since 2001. The lease expires in 2041, with a purchase option in October 2021 for $75,000,000. The property is encumbered by a $68,000,000 interest-only mortgage loan with a fixed rate of 4.72%, which matures in October 2021. The annual triple-net rent is the sum of $700,000 plus the amount of interest on the mortgage loan. If the purchase option is exercised, we will receive net cash proceeds of approximately $7,000,000 and recognize a gain on sale of land of approximately $60,000,000. If the purchase option is not exercised, the triple-net rent for the last 20 years would include debt service sufficient to fully amortize $68,000,000 over the remaining 20-year lease term.
Flushing
Our Flushing property is located on Roosevelt Avenue and Main Street in the downtown, commercial section of Flushing, Queens, New York. Roosevelt Avenue and Main Street are active shopping districts and there are many national retailers located in the area. A subway entrance is located directly in front of the property with bus service across the street. The property comprises a four-floor building containing 167,000 square feet and a parking garage, which is sub-leased to New World Mall LLC for the remainder of our ground lease term, which expires in January 2027 and has one 10-year extension option.
Property to be Developed
Rego Park III
We own a 140,000 square foot land parcel adjacent to the Rego Park II shopping center in Queens, New York, at the intersection of Junction Boulevard and the Horace Harding Service Road. The land is currently being used for paid public parking. In 2016, the Company started the entitlement process.
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