Department of Defense signs 10-year lease at once struggling Carle Place office building

A massive Carle Place office building once troubled by high vacancy rates and deteriorating infrastructure, but more recently eyed as the Long Island home for two federal agencies, has reached a 10-year lease deal with the U.S. Department of Defense, according to brokers on the deal.

The defense department is scheduled to take residency in the building at 1 Old County Road sometime early next year, according to Kelly Koukou of Lee & Associates NYC, who represented the property’s landlord, DBD Realty Group, in the lease deal. The Department of Defense will occupy 23,600 square feet of space at the five-story property, Koukou said.

Officials with DBD Realty Group did not immediately respond to requests for comment on Tuesday.

"The current owner spent a lot of money, around $30 million completely redoing the building," said Koukou, who brokered the $26.5 million sale of the property in February 2020 to current owner, Shahrokh Abiri and his DBD Realty.

Koukou said the lease with the defense department was originally signed roughly 8 months ago. The agency was working on specific site plans for their section of the building for months before the news could be shared widely, according to Koukou.

Officials with the Department of Defense could not immediately be reached for comment. 

The federal agency is the latest to lease space in the 320,000-square-foot building, which was the largest office property on Long Island when it opened in 1970.

In 2023, the Federal Aviation Administration signed a 15-year lease for more than 74,000 square feet to relocate its Eastern Regional administrative headquarters in Jamaica, Queens to the property. The FAA, which will occupy the buildings entire fifth floor and half of the fourth floor, is scheduled to officially make the move to the property in October, Koukou said.

About a year and half ago, the U.S. Army Corps of Engineers, an agency under the Department of Defense, moved into roughly 3,000 square feet at the office, Koukou said.

The property, which previously served as the headquarters of 1-800-Flowers.com before the company relocated to Jericho, has undergone a $22 million renovation. Upgrades, include a new facade, windows, lobby, bathrooms, and sprinkler system, Koukou said, adding that even more was spent when counting repairs to the existing parking structure. 

In 2020, the Nassau County Industrial Development Agency awarded DBD Realty a sales-tax exemption of up to 672,750 on the purchase of construction materials and furnishing to update the building, a mortgage recording tax break of up to $97,500, and a 20-year reduction in property taxes that freezes the tax rate for six years followed by increases of 1.81% per year, Newsday previously reported.