It’s the end of April, so you know what time it is: Our Power Finance issue has dropped!
Commercial Observer’s annual ranking of the industry’s top lenders and finance brokers comes during a tumultuous time in the industry that could rival the ups and downs of the popular HBO series “The White Lotus.”
The industry was coming off a strong fourth quarter of 2024 and had hopes of a booming 2025, but then a plot twist came in April with President Donald Trump’s tariffs plan shaking up international trade and the global capital markets.
Despite the turmoil last month, there was still a lot to celebrate last year, including the recovery of the commercial mortgage-backed securities market, largely powered by big banks, and private credit coming into its own.
So check out the rankings to see how those trends played out on the list. As for the top spot, Kara McShane of Wells Fargo (WFC) cinched it this year. And it’s hard to argue when Wells Fargo had $30.4 billion in originations, $15.4 billion in balance sheet originations and $6.7 billion in agency originations last year.
“Simply put, our clients continue to want to work with us because they know we are relentless in achieving best execution and pricing,” McShane said.
And, while it can be a dog-eat-dog battle to claim a spot on our list, one previous honoree waved goodbye to all that drama for a new life in the land of hobbits. Thorofare Capital’s David Perlman left his post at the firm to move (way) away from New York to Auckland, New Zealand.
“It’s something that’s very exciting, and we love the lifestyle here, particularly the quick access to an abundance of natural beauty and outdoor activities on our doorstep,” Perlman said. (Maybe he can also run into New Zealand’s fourth most popular comedy folk-duo while there.)
It’s leasin’ time
The leases of more than 100,000 square feet keep on coming in Manhattan. This time Deloitte, one of the Big Four accounting firms, agreed to a whopping 800,000 square feet at 70 Hudson Yards.
What makes it even better news for developers Related Companies and Oxford Properties is that Deloitte signed on months before the 60-plus-story tower even broke ground. Construction at 70 Hudson Yards isn’t expected to start until June.
There have been plenty of other sizable leases, too.
Manhattan recorded 3.4 million square feet of office leases in April. While that was a dropoff from the gangbuster month of March, it still was 23 percent better than April 2024 and 25.4 percent above the 10-year monthly average of 2.7 million square feet for the borough, according to a Colliers report.
And the biggest deal of the month per Colliers was Amazon (AMZN)’s previously reported lease to take 333,000 square feet at 10 Bryant Park. After significantly cutting its office space and ending leases early, Amazon seems to now have an insatiable appetite for New York City office space.
The e-commerce giant — fresh off a dressing down from our commander in chief — previously took 193,000 square feet at 237 Park Avenue and just this week bought the 23-story office building at 522 Fifth Avenue from RFR for an undisclosed price.
But Amazon’s mystery purchase wasn’t the only major sale of the week. Ralph Lauren dropped $132 million to buy the retail condominium units at 109 Prince Street from investor and art financier Jean-Pierre Lehmann.
The fashion brand has occupied the SoHo storefront since 2011 and had to win a bidding war with French retail giant LVMH — which has been hunting for a space for Tiffany & Co. on Prince Street for the past year — to keep its home there.
Check your watch, it’s earnings o’clock
If there was one word to sum up most of the first-quarter earnings calls last week, it would be “tariffs.”
Arbor Realty Trust (ABR) CEO Ivan Kaufman criticized President Trump’s tariff policy as causing “tremendous uncertainty” and “extreme” interest rate volatility, as it saw its net income drop; AvalonBay Communities went into the new year strong but predicted its development costs could increase by 5 percent because of tariffs, would could make some projects “infeasible;” Acadia Realty Trust braced for tariffs’ impact on the retail market; and Apollo Global Management (APO) said tariffs will not deter future growth even as it missed earnings estimates.
KKR (KKR) said it had already battened down the hatches to shore itself against the impact from the trade war; and Newmark (NMRK) CEO Barry Gosin warned “potential geopolitical headwinds” could have a “dampening effect” on the market, but the brokerage nevertheless saw a boost to its capital markets volume.
Meanwhile, Empire State Realty Trust saw a slight slowdown in visits to the Empire State Building’s observatory last quarter, as the country has seen a drop in international tourism caused by Trump’s policy shifts, including tariffs. CEO Anthony Malkin blamed the drop on “bad weather” and Easter shifting to the second quarter, noting that the building’s observatory numbers were “solid” over that holiday.
Other earnings calls last week included Alexandria Real Estate Equities, Ares Capital, BXP, Cushman & Wakefield, Digital Bridge Group, Equity Residential, Equinix, Welltower and Vici.
But earnings calls weren’t the only place fears of the tariff impacts manifested themselves. A Commercial Real Estate Finance Council survey found respondents expect worse economic conditions over the next 12 months. The CREFC sentiment index fell 30.5 percent after Trump announced his “Liberation Day” tariffs April 2, marking the first time the index fell below 100 since the start of the COVID-19 pandemic.
And the tariffs have rattled the retail market, with the financing, refinancing and leasing of retail assets freezing in place in many cases.
“We’ve seen a pretty significant temperature check from tenants looking to lease space, especially the ones that are either based overseas or are producing things overseas,” said Brandon Singer, founder and CEO of Retail by MONA. “A lot of them have said, ‘Let’s see how this shakes out before we sign the lease or take the next step.’ ”
This time, there’s no horse-ing around
If yesterday’s Kentucky Derby still has you buzzing about horse racing, how about a look into how its infrastructure is being redeveloped across the country?
New York’s Belmont Park and Saratoga Race Course, Kentucky’s Keeneland and Churchill Downs (site of the Kentucky Derby) and Maryland’s Pimlico Race Course have all been undertaking various renovation, construction and expansion projects as demand for in-person events skyrockets.
“There’s major growth in this industry coming, and it’s already happening, but I think we’ll see more of it,” said Mason Paoli, senior principal and interior design director for architecture design firm Populous, which has worked on most major track development projects. “We’re all glued to our phones, we’re oversensitized. … Culturally, I think we’re craving some of those more primitive, back-to-basics experiences.”
Finally, one of Brooklyn’s horse-storic landmarks is getting a new lease on life as a luxury residence. The former Opera Stables at 524 through 540 Halsey Street has been turned into luxury living spaces, with 67 percent of its units already sold.
Have a good Sunday!
