Major Developments:
Manchin-Schumer deal closes real estate tax loophole Package would raise taxes on carried interest, including developers’ “promotes. The senators’ plan would raise taxes on carried interest by about $14 billion, presumably by treating it as ordinary income rather than as a capital gain.Gov. Kathy Hochul and Mayor Eric Adams came to an agreement over how the city will collect property taxes from the 18 million square feet of construction planned on sites surrounding the station. The city will continue to collect the property taxes it receives now on the development sites, increasing by 3% each year. It will also get payments in lieu of taxes, or PILOTs, from the developers of each of the 10 future towers. The property owners will not pay traditional property taxes on the increased value of the land for up to 80 years.
Vornado Realty Trust could secure a tax break worth as much as $1.2 billion if it develops all of the sites surrounding Penn Station. The projects are supposed to help pay for the redevelopment and expansion of the beleaguered station.
The state could be short of the $3.4 billion to $5.9 billion it needs to pay for its portion of Penn-related projects.
The Hochul administration estimates that the state will be on the hook for $7.5 billion to $10 billion for redeveloping Penn and building the Gateway passenger train tunnel under the Hudson River. Reinvent estimates that the net revenue from payments in lieu of taxes or PILOTs will only support $4.1 billion in bonds.
CHIP estimated that 20,000 rent-stabilized apartments in the city were empty because renovations were not economically feasible. Landlords blame the state’s rent law for making repairs a money-losing proposition; lawmakers don’t believe them. Vacant but unavailable.
The Naftali Group filed plans for a 16-story project and demolition plans at 215 West 84th Street, while a holdout tenant remains.
MRR Development has spent four years and nearly $100 million building a 10-lot assemblage on the corner on Lexington Avenue between East 56th and 57th streets. The developer needs access to a squat building on the western edge of its assemblage, 124 East 57th Street.
Warehouse space is still harder to find than a parking spot in Times Square, but the U.S. industrial market is poised to cool off.
City Council approves Edgemere rezoning plan The rezoning is for a stretch of Edgemere, spanning from Beach 35th Street and Beach 50th Street. The rezoning could lead to the influx of more than 1,200 housing units. The council approved five applications from HPD for development projects that will feature mandatory inclusionary housing affordability rules. The developments will deliver 530 affordable units to the area.
Zelig Weiss throws another punch in a fight for William Vale by asking the bankruptcy court to stop the sale of the hotel to Avi Philipson. Worse, it would put Philipson or his partners in the captain’s seat on key decisions, according to Weiss’ complaint. He is seeking a court injunction to stop the sale.
Doronin’s Crown Building trades condo for $34.8 million. Unit 18A got a full offering price of $9,000 per sf from an international buyer for a 3,700-square-foot condominium in Aman at 730 Fifth Avenue in Midtown.
Microsoft co-founder Paul Allen’s estate sells UES units for $101 million, a penthouse and a lower unit sold at 4 East 66th Street. The buyer was a Delaware limited liability company.
Pilot received approval in April for excavation work for an eight-story, 81,000-square-foot building with 24 apartments. The plan included 35,000 square feet of commercial space.
Isaac Chetrit with brothers Eli and Ray and Jack Yadidi are building 625 apartments. They plan to shut down the Stewart Hotel across from the Madison Square Garden and convert it into apartments and 35,000 square feet of amenity space.
Rudin Management filed a permit application to build a 342,000-square-foot, 40-story tower at 415 Madison Avenue. It would replace a 24-story office building that Rudin completed in 1955.
Revlon is trying to escape its lease at 200 Park Avenue South and could use bankruptcy to exit. ABS Partners building has asked a judge to terminate office and retail leases of its subsidiary Elizabeth Arden at 200 Park Avenue South. Elizabeth Arden occupies 36,000 square feet of offices which expire in 2027 and a 10,000-square-foot, ground-floor retail space that expires in 2023. The retail space was an Elizabeth Arden day spa, is permanently closed and available for lease.
