New York Major Developments:An Upper East Side retail site that has been vacant for more than two years will soon be Morton Williams. A curated version of the supermarket is coming to 1251 Third Avenue, the former site of a Talbot’s. The grocery store chain has taken 13,000 square feet across two floors, with an asking rent of $2 million per year.
Chinese investment in the United States’ commercial real estate has plummeted by 55% last year, dropping from $16.2 billion in 2016 to $7.3 billion in 2017.
Purplebricks, a London-based discount brokerage, received $177 million equity investment from German media group Axel Springer SE to accelerate its expansion to New York. The company, which launched in 2014, said it would earmark $71 million of the cash infusion to ramp up operations in the United States.
Nonprofits and public organizations took advantage of flat office rents last year to obtain big deals, and demand from the sector also helped prop up the otherwise slow commercial sales market. In 2017, nonprofits and public organizations inked 6 million square feet worth of leases in the city.
The EB-5 visa program is sticking around. The program, which allows foreign investors to obtain a green card if they put $500,000 into job-creating projects, will remain in place until September 30, due to its inclusion in the spending bill Congress passed. The program was almost extended for five years.
11 Hancock Place is the area's latest house of worship potentially reborn as luxury housing Developer Chaim Nortman is looking to bring 69 condominiums to his Harlem development at 11 Hancock Place.
A group of Parker Towers tenants is suing the Jack Parker Corporation, alleging the company illegally deregulated numerous units at the Queens apartment complex. The lawsuit, filed is one of the largest J-51 lawsuits in the city’s history. The 1,350-unit Forest Hills rental apartment complex received tax breaks under the J-51 program, which requires landlords to keep apartments rent-stabilized, through December 2010, the lawsuit says. Despite receiving those tax breaks, the landlord leased out apartments at market-rents, never provided stabilized leases to the tenants, and also failed to register them as rent-stabilized with the New York Department of Housing and Community Renewal.
Developers are buying more air- rights for offices than for residential condominiums for the first time in years. The average pricing for office air- rights reached $315 per square foot, which was its highest in history. JPMorgan Chase is paying in the $300s for development rights at its Midtown expansion at 270 Park Avenue. Air rights in Hudson Yards last year went for an average of $235 per square foot.
The City Planning Commission unanimously approved selling development rights to West Chelsea property owners for $625 per square foot in February. There are 3.6 million square feet of air- rights could deliver landlords in Midtown East, just under $900 million over the next two decades.
Bandier has signed a lease for its new U.S. flagship a retail and office totaling 27,500 square feet at 670 Broadway in Noho. There is 4,500 square feet on the ground floor, 13,000 square feet on the fourth floor, and 10,000 square feet on the lower level. Bandier’s fitness studio offshoot, Studio B, will occupy part of the fourth floor; the remaining 8,000 square feet on that floor will be office space. Asking rents were $300 per square foot for the ground-floor retail and $110 per square foot for the office.
A judge has issued a temporary restraining order on Williamsburg’s controversial Broadway Triangle site that both sides struggle. Groups opposing the development claimed victory because they said the order shows the builder cannot move forward with his project. Rabsky Group claimed victory as the order does not prevent them from doing pre-construction work. The Broadway Triangle development, located at Pfizer’s pharmaceutical facilities, would consist of eight buildings and 1,146 units. The valuation of the site jumped from $92 million to $186 million, after the City Planning Commission signed off on a rezoning of the site, allowing the developers to move forward with their plans for a 1.1 million-square-foot housing complex. The eight-building complex will include 1,146 housing units, of which 287 will be permanently affordable, and 65,000 square feet of retail space.
The Trump administration’s caps on state local tax deductions and new limits on the mortgage-interest deduction put “the for-sale housing market in the toilet in NYC. California and New York have been very negatively impacted by this tax reform plan. New York could see some positive changes if the Senate flips into Democratic hands in this year’s midterm elections.
New York has 176,000 units of public housing that need repairs to the tune of an estimated $25 billion and tenants and NYCHA feel they may have a solution: privatization.
Department of Housing and Urban Development are arguing over who will pay for the repairs and maintenance. Many tenants, advocates and Obama-era officials are in favor of NYCHA handing over the reins to private companies and real estate developers. One public-housing complex has been transferred into private management so far, though Olatoye intends on transferring an additional 15,000 units over the next 10 years.
While Jared Kushner was at the helm, Kushner Companies filed at least 80 work permits in 34 buildings throughout New York stating there were no rent-regulated tenants living at the properties, but tax documents prove the applications were false. Tax records show there were at least 300 rent-regulated units across the 34-property portfolio at the time.
The Department of City Planning is looking to change parking and other zoning rules to encourage commercial development in the outer boroughs. Developers are required to set aside large swaths of space for parking. City Planning director is beginning to assess changing those outdated rules.
AJ Capital Partners inked a 65-year ground lease for a site on Roosevelt Island where the company and Cornell Tech are building a 224-key hotel. The lease includes a site adjacent to the Verizon Executive Education Center on North Loop Road where the firm and University are developing a Graduate-branded hotel. The deal is valued at $113 million, which would mean installments of $1.7 million each year, if paid equally across six-and-a-half decades. AJ Capital has first dibs on buying the property if Cornell decides to sell the site.
Camber Property Group is planning a nine-story, 136-unit residential building in Harlem. Victory Plaza will span roughly 150,500 square feet and stand 87 feet tall. The residential units will be affordable rentals, and Camber expects the project to cost $58.4 million. The project is a joint venture between Camber and its non-profit partner Harlem Congregations for Community Improvement, and the housing will be for seniors. Construction on the building should begin late in 2018 and finish late in 2020.
Offering plans for condominium and co-op projects across the five boroughs with a combined sellout over $28 billion of at least $100,000,000.
NYC condo offering plans:
|Condo Plan||# Resi Units||Latest Sellout|
|Central Park Tower Condo.||179||$4,016,410,000|
|220 Central Park South||87||$3,392,486,000|
|432 Park Avenue||142||$3,125,815,425|
|53 West 53rd Street||169||$2,142,855,250|
|550 Madison Avenue||96||$1,898,050,000|
|One Manhattan Square||815||$1,875,526,667|
|15 Hudson Yards||285||$1,740,010,000|
|15 Central Park West||220||$1,733,917,000|
|The Greenwich Lane||200||$1,709,936,500|
|111 West 57th Street Condo.||60||$1,454,517,000|
|30 Park Place||157||$1,222,170,000|
|50 West Street||191||$1,154,760,924|
|111 Murray Street Condo.||155||$1,047,261,500|
|One West End Avenue Condo. 246||$1,011,823,000|
|125 Greenwich Condo.||275||$875,394,450|
|One Riverside Park Condo. 219||$870,894,000|
|100 Barclay Street||161||$870,586,000|
|Gramercy Square Condo.||223||$817,499,000|
|252 East 57th Street||93||$768,510,500|
|45 East 22nd Street Condo.||83||$707,203,125|
|Trump World Tower||1||$667,552,880|
|530 Park Avenue Condo.||125||$565,855,000|
|685 First Avenue Condo.||148||$550,740,000|
|Carnegie Park Condo.||325||$483,419,000|
|135 West 52nd Street Condo.||109||$467,754,401|
|520 West 28th Street||40||$434,920,000|
|275 West 10th Street Condo.||61||$399,668,250|
|200 East 62nd Street||115||$394,772,378|
|550 Vanderbilt Condo.||278||$394,172,800|
|45 Park Place Condo.||50||$391,895,000|
|250 West Street Condo.||111||$349,576,500|
|400 Park Avenue South||99||$340,000,190|
|49 Chambers Street||99||$333,925,000|
|200 East 59th Street Condo.||68||$333,635,000|
|235 West 75th Street Condo.||199||$316,440,000|
|Citizen 360 Condo.||81||$313,934,500|
|172 Madison Avenue Condo.||69||$308,610,000|
|180 East 88th Street||48||$308,223,000|
|88 Lexington Avenue Condo.||122||$295,969,500|
|161 Maiden Lane Condo.||80||$273,209,000|
|959 First Avenue||113||$271,875,025|
|389 East 89th Street||0||$268,986,400|
|Grand Two at Sky View Parc||278||$265,213,544|
|1010 Park Avenue||11||$247,794,000|
|Nine 52nd Condo.||155||$232,404,840|
|301 East 50th Street Condo.||57||$229,021,000|
|165 West 91st Street Condo.||0||$225,805,000|
|438 East 12th Street Condo.||82||$222,660,000|
|360 Central Park West Condo.||146||$217,182,500|
|196 Orchard Street Condo.||94||$206,741,000|
|51 Jay Street||74||$192,957,999|
|300 West 122nd Street Condo.||127||$188,696,577|
|325 Lexington Avenue||0||$186,760,000|
|385 First Avenue||0||$184,064,000|
|90 Lexington Avenue Condo.||74||$175,162,150|
|270 Riverside Drive Condo.||57||$174,718,029|
|Franklin Place Condo||51||$174,341,000|
|AKA Sutton Place Condo||76||$166,575,000|
|100 Barrow Street||33||$159,024,905|
|540 West Condo.||114||$155,375,000|
|75 Kenmare Street Condo.||38||$140,610,000|
|550 West 29th Street Condo.||19||$137,000,000|
|155 West 18th Street||30||$131,321,200|
|1399 Park Avenue Condo.||72||$125,118,000|
|99 Wall Street||52||$119,065,000|
|215 Chrystie Street||11||$118,400,000|
|234 East 23rd Street Condo.||57||$116,003,500|
|The New York Arts Condo.||8||$105,176,200|
|290 West Street||13||$101,100,000|
Landmarks Preservation Commission gave its approval to build its 29-story residential project at 550 Clinton Avenue next to the landmarked Church of St. Luke and St. Matthew.
Discovery Communications and Scripps Networks will consolidate their New York City offices at TF Cornerstone’s 230 Park Avenue South. Discovery, which just completed a $12 billion takeover over Scripps, plans to move the companies’ combined operations into 250,000 square feet in the building.
The Department of Housing Preservation announced that 1,788 properties did not comply with the requirements of 421a by failing to file a final certificate of eligibility. The property owners, along with more than 3,000 others, were warned in December 2016 that they’d lose the tax break if they didn’t file the certificate within 13 months. They allegedly missed that deadline and, as a result, had their benefits revoked. Together, these owners avoided paying $66 million in taxes in 2018 thanks to 421a, according to HPD. They have one more chance to recoup the tax break.
February’s top 10 retail leases were slightly higher than January’s in terms of square footage.
The 10 biggest deals signed last month totaled 108,184 square feet, up 13,536 square feet from last month’s total of 94,648 square feet.
1) T.J. Maxx, 250 West 57th Street, Midtown – 19,000 square feet
SkyFoods Kissena, 41-61 Kissena Boulevard, Flushing – 14,519 square feet
3) Alo Yoga, 241 Bedford Avenue, Williamsburg – 14,228 square feet
4) Modell’s Sporting Goods, 1601 Kings Highway, Sheepshead Bay – 13,905 square feet
5) NoHo Hospitality Group, 80 South Street, Financial District – 11,000 square feet
6) Sam Won Garden Artisanal Korean Barbecue, 37 West 32nd Street, Midtown South – 10,000 square feet
7) 36 H&Y Duet, 65 West 36th Street, Midtown South – 7,565 square feet
8) Chloe + Isabel, 40 Exchange Place, Financial District – 6,517 square feet
9) Aerie, 75 Spring Street, Soho – 6,500 square feet
10) Tim Ho Wan, 610 Ninth Avenue, Hell’s Kitchen – 6,250 square feet
11) Bulldozer NYC, 135 West 52nd Street, Midtown – 5,200 square feet
The top 10 NYC office leases in February
February’s top offices leases deals totaled 1.2 million square feet, matching 1.2 Million square feet.
1) Omnicom Group, 195 Broadway, Financial District – 288,000 square feet
2) WeWork, 18 West 18th Street, Flatiron – 177,000 square feet
3) Nasdaq, 4 Times Square, Times Square – 145,000 square feet
4) WeWork, 154 West 14th Street – 120,000 square feet
5) Gay Men’s Health Crisis, 307 West 38th Street, Hudson Yards – 112,000 square feet
6) Brooklyn Lab Charter School, 77 Sands Street, Dumbo – 81,648 square feet
7) Facebook, 770 Broadway, Noho – 78,000 square feet
8) Estee Lauder, 767 Fifth Avenue – 77,700 square feet
9) Brown Rudnick, 7 Times Square, Times Square – 70,754 square feet
10) Campari America, 1114 Sixth Avenue, Midtown – 65,000 square feet
JPMorgan Chase has signed a lease for almost 440,000 square feet across 16 floors at L&L’s 32-story building at 390 Madison Avenue to house thousands of employees while its own 70-story headquarters gets built a block away. The 10-year lease includes two retail spaces, a conference center and outdoor terraces. The company will take up half of the space in the office building and work on floors two through six, 14 and 22 through 32. Asking rents at the building go for between $87 and $125 per square foot.
The owners of 405 Park Avenue are buying 30,000 square feet of air rights from St. Patrick’s Cathedral for about $10 million, the second deal under the city’s Midtown East rezoning. MRP Realty now plan to add four floors and 205,000 square feet of office space to the building with the air rights purchase.
The city’s Department of Housing Development and Preservation will issue a request for information and interest in building modular housing for low-income tenants and seniors. Deputy Mayor Alicia Glen said that the city aims to “crack the code” on mid-rise multifamily development, in the hopes this will be “a new chapter for modular.”
HNA Group’s 245 Park Avenue will have to invest hundreds of millions of dollars in order to modernize the 1960s-era trophy tower and attract new tenants. The new owner will be facing vacancies of roughly 13%. The building’s largest tenant, JPMorgan occupies 40% of the tower and is constructing a new headquarters nearby set to be completed by 2024. The 1.7 million-square-foot tower will need about $850 million to make upgrades like a new lobby and sprinkler system. It will probably also require another $230 million to renovate spaces for tenants over the next several years. HNA paid $2.21 billion last year. The company is under pressure from the Chinese government to unload billions of dollars in commercial real estate at a time when prices are falling.