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Photo: Steve Gottlleb Photography
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1500 Broadway on Times Square
New York, NY
Karchem's Role: Developer
For: Intertech Corporation
Size: 32-story 501,000 SF office building including 40,000 SF of retail
Year Built: 1972
Budget: $4.5 million
Schedule: 18 months
For this international investment company, Karchem Properties conducted the acquisition due diligence for the purchase of an office building on Times Square. Based on the recommendations from the due diligence study, Karchem Properties directed the renovation of the building.
Karchem initiated an exterior signage program to capitalize on the building's high-visibility location at the heart of Times Square, which culminated in additional lease revenue. After performing a tenant restacking analysis, Karchem determined that consolidation of smaller tenants could yield significant upside through the creation of full floors suitable for higher-rate paying tenants.
Karchem renovated the exterior skin and replaced the mechanical systems and elevators. Installation of new chillers cut the annual utility consumption by $200,000 and eliminated outside service and maintenance costs of $50,000 in the first year. Because Armor Kone was a tenant in the building, Karchem was able to negotiate a much lower purchase price for the elevators in return for allowing Kone to install signage in front of their suite's window.
Karchem advised Intertech on selecting a new property management company. Karchem then coordinated the interviews and compared proposals to make a final recommendation to Intertech. In 1999, Karchem Properties conducted a Y2K assessment on the building systems.
At the time of acquisition, the 40,000 SF retail component was leased by 5 underperforming tenants including a 2-screen movie theater, 2 restaurants and several smaller shops. The retail now houses the studios of the ABC TV program Good Morning America.
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