Capital One Said in Talks to Sublease NYC Spaces From UBS
The McLean, Virginia-based bank is expected to take most of the 382,000 square feet (35,500 square meters) that Zurich-based UBS AG (UBSN) had listed for sublease at 299 Park Ave., a 1.2 million-square-foot skyscraper, said the people, who asked not to be identified because the discussions are private. The two sides have agreed to terms, one of the people said.
A deal would place Capital One, best known for its widely advertised credit card, in the heart of Midtown’s financial corridor among major New York-based banks. The building is diagonally across from the headquarters of JPMorgan Chase & Co., and five blocks south of Citigroup Inc.’s main offices.
“One of their strategic objectives is to be viewed as a full-service financial company and not just a credit-card company,” David Albertazzi, a senior banking analyst at Boston-based Aite Group LLC, said in a telephone interview. “A strong presence in the center of the financial world makes a difference.”
Chief Executive Officer Richard Fairbank has spent more than $28 billion on acquisitions since 2005 to build Capital One into the ninth-largest U.S. lender by assets. Recent deals include the 2012 purchases of ING Direct USA, an online bank, and a portfolio of credit-card assets from HSBC Holdings Plc.
Capital One was last year’s fifth-largest U.S. credit-card issuer by volume of purchases, with $167 billion, data compiled by Bloomberg show. The leader was American Express Co. (AXP), with $462 billion. Capital One’s volume has grown 78 percent since 2009.
Capital One currently has offices at 90 Park Ave., south of Grand Central Terminal.
UBS, Switzerland’s largest bank, is scaling back its offices in Manhattan as it seeks to cut costs. The company plans to put most of its New York-area operations into 1285 Avenue of the Americas, a 1.7 million-square-foot skyscraper six blocks away, while maintaining its offices in Stamford, Connecticut, Robert Alexander, regional chairman of CBRE Group Inc., said in May. CBRE is representing UBS in the negotiations.
Alexander didn’t return two phone messages. Robert McGrath, a CBRE spokesman, said he had no immediate comment. Julie Rakes, a Capital One spokeswoman, declined to comment.
The Park Avenue tower is majority-owned and managed by Fisher Brothers Realty Corp. UBS’s lease on its 510,000 square feet in the building, which features a large red company logo in its lobby, expires in 2018. Capital One is in talks with Fisher Brothers on a direct lease so it can stay beyond the end of UBS’s term, one of the people with knowledge of the matter said.
Jody Fisher, a spokesman for the landlord, said the company declined to comment on the negotiations. He isn’t related to the Fisher Brothers family. Nicholas Derasmo, a spokesman for Cushman & Wakefield Inc., which is representing Capital One, also declined to comment.