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February 2014

February 2014 » Market Analysis » NY New Developments

February 2014 New York New Developments


New Developments

A Brooklyn fashion networking company away is moving into Manhattan. Manufacture NYC, a program that gives budding designers access to industrial sewing machines and design software, conducted an exhaustive search for a budget-friendly spot in Brooklyn before finally giving up and settling on a space in Manhattan’s Garment District.

7-Eleven is trying to gain acceptance in Manhattan. Since entering Manhattan in 2011 the number of locations has quadrupled from eight to 37 stores.

Hospitals are increasingly opening full-service walk-in clinics in an effort to reduce inpatient costs. As a result, outpatient medical facilities are cropping up throughout the city. The medical offices have been largely replacing retail outlets and moving closer to where people work and live, rather than near a hospital.

A fence that has cordoned off the World Trade Center for the past 13 years is set to come down – at least partially – in 2014. The move will allow visitors to the 9/11 Memorial to move freely between the memorial and the neighborhood.

Seven Bryant Park is close to singing a lease for 30 percent of the 471,000-square-foot tower, developed by Hines. Law firm Reed Smith is in talks to take a 160,000-square-foot space in the building, and is in competition with another tenant. The winner would be the 30-story building’s anchor tenant Rents on the building’s base floor are reportedly asking $80s per square foot. The building’s upper floors, by contrast, are said to be asking as much as $200 per square foot.

Developer Jonathan Kushner has partnered with Ironstate Development to build a 40-story, 135,000-square-foot condominium tower at 281 Fifth Avenue at East 30th Street in Midtown. Kushner, first cousin of fellow owner and developer Jared Kushner, began acquiring three buildings at that corner from SK Properties in 2007, with the intention of developing a residential project.

Extell Development is tearing down a sizable chunk of an East Village block to make way for a new retail and residential development.

West Village church St. Luke in the Fields will develop a 15-story residential building to fund its own new buildings. The church plans to construct a 70,000-square-foot residential rental building at 100 Barrow Street, part of an entire block St. Luke owns. The 153-foot tower would be built as-of-right and is planned to be so-called 80/20 housing, which would give the developer a tax break for making a portion of the residences affordable. The developer hasn’t yet applied for the 421a tax exemption, but plans to do so soon.

Developers are getting schooled. Builders, it seems, are capitalizing on a recent uptick in interest in the West Chelsea condo market from parents whose children attend the elite Avenues School, a 1,600-seat private school at 259 10th Avenue, which opened in 2012 and serves pre-K to ninth grade.

Mayor Bill de Blasio plans to charge rent to some charter schools, spurring concerns from school operators and parents that some institutions will close. Roughly two-thirds of the city’s charter schools are housed within public school buildings, and the free rent amounts to a subsidy of around $100 million per year citywide.

About 750,000 square feet of retail space is coming to market, as the Related Companies formally starts its search for tenants at its Hudson Yards project.

An $8 million expansion of the Lower East Side’s Tenement Museum is being funded in part by developers including Taconic Investment Partners and L+M Development Partners.

Exponents, an outpatient facility that treats drug and alcohol abusers as well as ex-convicts looking to rehabilitate and those suffering from HIV and AIDS, is relocating from 150 West 26th Street in Chelsea to 2 Washington Street has residents concerned. . Exponents founder Howard Josepher told Community Board 1’s Financial District committee that escalating rents at the current location had prompted the decision

American Realty Advisors landed Dow Chemical Company for the top two floors for their newly acquired499 Park Avenue. ARA bought the building from Hines for $250 million. The rent will be north of $130/RSF for the 18,244-square-foot space.

The Chelsea Arts Tower has two commercial condominiums available that may just be the priciest office space ever offered in New York City. The top floor condo, asking $2,800 per square foot, and space on the fourteenth floor for $1,600 per square foot would put as much as $12 million and $8 million.

Neighborhood groups aiming to curb New York University’s expansion in Greenwich Village are threatening to sue should the school continue any part of its plan. The threat comes after NYU’s original $6 billion expansion planswere blocked by state Supreme Court Justice Donna Mills because they would raze three city parks, including Mercer Playground and LaGuardia Park.
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A subcommittee Community Board 3 has approved the $94 million overhaul of Pier 42. The project, which encompasses eight acres between Montgomery and Jackson streets, is awaiting final approvals from the Public Design Commission of the City of New York and the full board of Community Board 3.

The Museum of Modern Art will raze the former home of the American Folk Art Museum at West 53rd Street to make way for its expansion project, despite a last-minute push by the architects to incorporate the folk art building into their plans rather than demolish it.

A three-story building at 1628-1630 Broadway is available in a triple-net lease for $1.5 million per year. The corner property features 11,200 square feet, including 57 feet of frontage on West 50th Street and 50 feet of frontage on Broadway. A billboard covering the windows on the third floor is separately leased.

First Republic Bank is expanding its space at 1230 Avenue of the Americas. The bank has added 38,000 square feet to take over the entire seventh floor, as well as added space on the second and third floors.

Optima Real Estate is developing a Gene Kaufman-designed hotel at 333 West 38th Street. The 21-story hotel between Eighth and Ninth avenues will contain 79 rooms and will open in 2015.. The land is contaminated with semi-volatile organic compounds, according to public documents filed with city’s Office of Environmental Remediation. The OEM is in the midst of cleaning up the groundwater at the site.

Several retail stores on Clinton Street are being closed to make way for residential development. The latest store located closing at 52-60 Clinton Street is Community 54, a streetwear brand that opened at the location in 2011.

Billy Macklowe has closed on the $62.5 million acquisition of an office building at 156 William Street. Macklowe intends to convert the 250,000-square-foot office building into a medical facility.
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New York Methodist Hospital is going to propose a revised design for its expanded outpatient center to Community Board 6. The project will be located at 506 6th Street in Park Slope. Residents have argued that the project does not fit with the character neighborhood. The hospital has made around 20 changes to the original plan, based on community input over the past six months.

Abu Dhabi Investment Authority is investing in the Related Companies-led $1.3 billion purchase of Time Warner’s space in the Time Warner Center in Columbus Circle. ADIA is investing with Singaporean sovereign wealth fund GIC, who in November pledged $400 million to the acquisition, which is still being negotiated.

Online shopping could seriously cripple the New York City retail world as buying things online is so easy and quick. New Yorkers don’t bother trekking to the grocery store or even the corner bodega for necessities like toilet paper or toothpaste. They just order online from Amazon Prime and wait for it to be shipped to their doorstep, free of charge.

Several developers are handling purchasing, leasing and construction of dormitory buildings in the city, a job previously done by the schools themselves. Dormitories fit more tenants in a given space than apartments – and universities can save money by outsourcing the job of developing the facilities. Developers have been criticized for constructing dorms as a tactic to circumvent zoning rules and build double the size of a typical apartment complex.


Buildings Sold:

Lalezarian Properties sold its Financial District rental building at 15 Cliff Street to Carmel Partners for $95 million. Carmel Partners, buys underperforming multi-family assets in supply-constrained markets and tries to add value through renovation and repositioning. The company owns two other rental buildings in Manhattan: The Renoir House, is a 151-unit property at 225 East 63rd Street and and the Electra, is located at 354 East 91st Street.

The 17-story, 14-unit commercial property at 22-26 West 32nd Street has sold for $55 million. The building has 113,000-square-foot of commercial space in Koreatown The building has 12,000 square feet of retail and 101,000 square feet of storage and office space. The Forest Hills, Queens-based buyer of the building operates as Montague Lee 32 LLC, or Lee Roosevelt Thirty Eight.

Infinity Real Estate and Katz Properties sold a 16-story, 70,200-square-foot Chelsea office building for $31.75 million. Twenty-one office tenants occupy the prewar property at 247 West 30th Street between Seventh and Eighth avenues.

1128 Third Avenue sold for $9.5 million. L3 Capital handed off the 5,300-square-foot, four-story site to an undisclosed investor.

Hunter College of the City University of New York has closed on its purchase of the fourth floor at Weill Cornell Medical College’s new Belfer Research Building at 413 East 69th Street. CUNY paid $65 million for the 21,000-square-foot space, which it will use as a laboratory for life sciences research. The university will also have access to Weill Cornell research cores and services, such as conference facilities in the building

Sam Chang is in contract to buy a 22-story hotel is rising on the Garment District parking lot site. Architect Gene Kaufman will design the 88,860 SF, 257-foot-tall building, at 326 West 37th Street. There will be 240 rooms, a fitness center and a restaurant.

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