Commercial Observer reports that the New York City School Construction Authority has leased the ground floor of Gary Barnett’s 30-story condominium building on the Upper East Side for a pre-kindergarten program, according to public records.
The agency, which develops and leases on behalf of the city’s Department of Education, inked a 15-year deal for 11,492 square feet at the base of The Kent, Extell Development Company’s 83-unit condo project at 200 East 95th Street at the corner of Third Avenue. The DOE will open a public pre-kindergarten in September in the Beyer Blinder Belle-designed building, according to a spokesman for the SCA.
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Although it’s still under construction, the Kent is set to open at the end of 2018 and currently has apartments for sale ranging from a two-bedroom, two-bathroom unit asking $2.5 million to a five-bedroom, four-and-a-half-bath pad for $8.4 million.
Howard Kesseler of Newmark Knight Frank represented the SCA in the transaction, and it’s unclear if Extell had a broker. Kesseler didn’t immediately respond to a request for comment. A spokeswoman for Extell did not respond with a comment.
The city will pay $1.97 million annually ($171 a square foot) for the first five years of the lease, per the memorandum of lease on file with the Department of Finance, $2.17 million ($188 a square foot) annually for the following five years, and $2.38 million ($207 a square foot) for the 10th through 15th years of the lease. Asking rents for educational and medical space in Manhattan averaged $47 a square foot in 2017, according to data from CBRE.
While the rent seems expensive, schools have few alternatives when it comes to leasing space in pricey areas of Manhattan and Brooklyn. Commercial Observer recently talked to private school administrators about the struggle to find affordable locations to rent or buy in Brooklyn, and the public school system faces similar financial pressures as it hunts for space to expand throughout the five boroughs.
Photo credit: The Kent by Extell.