January 2023 » Market Analysis » NY New Developments

January 2023 New York New Developments

Major Developments:

The Mayor and the Governor laid out initiatives to future-proof New York, including 40 proposals aimed at increasing the housing supply and making business districts more attractive.

The city and state will push to increase mass transit options and housing around employment hubs to cut commute times.

Other proposals include removing the cap on the residential floor area ratio as well as allowing accessory dwelling units.

New York’s Emergency Rental Assistance Program will finally shutter Jan. 15. ERAP provided eviction protection despite running out of rent aid, resulting from a lawsuit settlement Non paying tenants to delay eviction just by applying. Landlords were forced to house them with little hope of repayment. If more funding from the state or federal government comes in after Jan. 15, the program will accept new applications. If the state then opts to close the portal again, tenants are allowed to challenge that in court.

Rising interest rates, expiration of 421a tax break that expired June 15, crush development added to only 351 new building filings in New York City in the third quarter, down 17% from the second quarter and 28% year-over-year.

Condo projects were largely excluded from the most recent iteration of 421a.

Mets owner airs development plans for space around Citi Field which will include open space, entertainment for a 50-acre area including building green spaces, increasing waterfront access and expanding walkability and transit options. A casino is anticipated next to Citi Field in the Citi Field parking lot but the parking lot is mired in lease and bond agreements; the area around Citi Field has been notoriously difficult to develop.

Eric Adams' proposal for fewer cars and more space could elevate retail rents on Fifth Avenue, between Bryant Park and Central Park for more pedestrian friendly from 42nd to 59th streets.

Adams’ first rezoning plan centers on a 46-block stretch of the Bronx. The Application is expected to start ULURP in 2023. The city’s proposed rezoning of a 46-block stretch of the Bronx. The Department of City Planning is expected to begin the Universal Land Use Review Procedure (ULURP) by the summer.

The Bronx rezoning area is adjacent to the campuses of the Jacobi, Calvary and Montefiore hospitals. Some manufacturing and commercial sections would be rezoned for residential use, while residential density will be increased in select sections.

The 30-story former Jehovah’s Witness hotel at 90 Sands Street was converted to 490 units, will have 385 formerly homeless tenants who will pay no more than 30% of their income in rent, and another 105 rent-restricted tenants who will pay between $540 and $2,130 per month for studio and one-bedroom apartments with on-site mental health and support services.

Blackstone, Starwood REITs draw SEC’s attention after limiting withdrawals The Securities and Exchange Commission has reached out to both firms to understand the market impact and circumstances of the decisions.

Roc Nation announced as entertainment partner in Times Square proposal SL Green, Caesars at the proposed casino.

Vornado Realty Trust and Rudin Management have reached a deal with Griffin’s Citadel that allows the developers to construct a 1.7-million-square-foot Midtown East tower for the buildings at 350 Park Avenue and 40 East 52nd Street, to be razed. Citadel will master-lease Vornado’s 585,000-square-foot 350 Park Avenue for 10 years, with an initial annual rent of $36 million. Citadel will also master-lease Rudin’s adjacent 390,000-square-foot property at 40 East 52nd Street.

Vornado will form a joint venture with Rudin to buy 39 East 51st Street for $40 million and will combine that site with 350 Park Avenue and 40 East 52nd Street. The deal gives Griffin the option to acquire a majority interest in the joint venture at a $1.2 billion valuation to build a 1.7 million-square-foot tower at the site, or exercise an option to buy the site outright for $1.4 billion and go it alone on the development.

Trinity Place Holdings reached an amended loan agreement with its senior lender, Macquarie Group, to resolve its defaults at 77 Greenwich Street in Lower Manhattan, extending the condo project’s completion date to September. 77 Greenwich Street had plans for a mixed-use, 90-unit tower with an elementary school and 7,500 square feet of retail.

A jury found affiliate companies of the Trump Organization guilty of nine counts of tax fraud and related crimes.

Blackstone Real Estate Income Trust restricted investor withdrawals. The idea that there is something going wrong with this product because people are redeeming is conflating completely incorrect assumptions,” Schwarzman said. Redemption requests were restricted after withdrawal demand exceeded 2% of the net asset value monthly limit and 5% of the quarterly threshold. BREIT fulfilled 43% of redemption requests in November, but will only fulfill 0.3% this month.

The median sale price of Manhattan condos in the third quarter was twice that of co-ops at $1.6 million versus $800,000. In 1994, they were the same. Manhattan co-op inventory was 4,714 units while condo inventory was 4,414.

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