Exhibit
10.4 FIRST AMENDMENT TO THE 
AMENDED AND RESTATED MANAGEMENT AGREEMENT  This First Amendment
(this Amendment) to the Amended and Restated Management Agreement
is made as of September 18, 2007 (the Effective Time) by and
between Gramercy Capital Corp., a Maryland corporation (the Parent),
GKK Capital LP, a Delaware limited partnership (the Operating Partnership)
and GKK Manager LLC, a Delaware limited liability company (the Manager).  Capitalized terms used by not defined herein
shall have the meanings ascribed to those terms in the Management Agreement (as
defined below). WHEREAS, the Parent, the
Operating Partnership and the Manager have entered into an amended and restated
management agreement dated as of April 19, 2006 (the Management Agreement);
and WHEREAS, the Parent, the
Operating Partnership and the Manager desire to amend the Management Agreement
as set forth herein. NOW, THEREFORE, in
consideration of the mutual agreements herein set forth, the parties hereto
agree as follows: 1.             Amendment to the Management
Agreement. Section 8(b) of the Management Agreement shall be deleted
and replaced in its entirety with the following: (b)         In connection with any and all CDOs
formed, owned or controlled, directly or indirectly, by the Company, the
Manager shall receive management, service and similar fees equal to
(i) 0.25% per annum of the principal amount outstanding of bonds issued by
a managed transitional CDO that are owned by third-party investors unaffiliated
with the Company or the Manager, which CDO is structured to own loans secured
by transitional properties, (ii) 0.15% per annum of the book value of the
principal amount outstanding of bonds issued by a managed non-transitional CDO
that are owned by third-party investors unaffiliated with the Company or the
Manager, which CDO is structured to own loans secured by non-transitional
properties, (iii) 0.10% per annum of the principal amount outstanding of
bonds issued by a static CDO that are owned by third-party investors unaffiliated
with the Company or the Manager, which CDO is structured to own non-investment
grade bonds, and (iv) 0.05% per annum of the principal amount outstanding
of bonds issued by a static CDO that are owned by third-party investors
unaffiliated with the Company or the Manager, which CDO is structured to own
investment grade bonds.  For the purposes
of this Section 8(b), a managed transitional CDO shall mean a CDO that is
actively managed, has a reinvestment period and is structured to own debt
collateral secured primarily by non-stabilized real estate assets that are
expected to experience substantial net operating income growth.  For the purposes of this Section 8(b), a managed
non-transitional CDO shall mean a CDO that is actively managed, has a
reinvestment period and is structured to own debt collateral secured primarily
by stabilized real estate assets that are not expected to experience
substantial net operating income growth. 
For the avoidance of doubt, both managed transitional and managed
non-transitional CDOs may at any given time during the reinvestment period of
the respective vehicles invest


in and own non-debt
collateral (in limited quantity) as defined by the respective Indentures. The parties hereto
agree that the foregoing amendment is effective as of April 19, 2006. 2.             Full Force and Effect.  Except as expressly amended herein, all other
terms and provisions of the Management Agreement remain in full force and
effect and are hereby ratified and confirmed in all respects. 3.             Governing Law.  This Amendment shall be governed by and
construed in accordance with the laws of the State of New York. IN WITNESS WHEREOF, the parties
hereto have executed this Amendment as of the date first above written. GKK MANAGER LLC,a Delaware limited
  liability companyBy:
  /s/ Andrew LevineName: Andrew LevineTitle:GRAMERCY CAPITAL CORP.,a Maryland corporationBy:
  /s/ Robert R. FoleyName: Robert R. FoleyTitle: Chief Financial
  OfficerGKK CAPITAL LP,a Delaware limited
  partnershipBy:
  /s/ Robert R. FoleyName: Robert R. FoleyTitle: Chief Financial
  Officer