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June 2021

June 2021 » Market Analysis » NY New Developments

June 2021 New York New Developments

New Developments

The Gateway tunnel is back on track. Federal officials completed their environmental review of the $11.6 billion rail tunnel, giving the project the green light. The move comes after years of delays from the Trump administration. The plan calls for building a new rail tunnel beneath the Hudson River, which would connect New Jersey’s Bergen Palisades to New York’s Penn Station. The approval could potentially advance real estate acquisitions and other pre-construction activities.

State lawmakers are seeking to give New York City more control over Cuomo’s Penn Station expansion and new development in the surrounding area. A recently introduced bill would force the project to go through the city’s seven-month land use review process, rather than a state-led General Project Plan that overrides local zoning. In January 2020, Cuomo pitched an expansion of Penn Station that would be funded, in part, by real estate development in the immediate area. The following year, the governor announced additional plans to add 20 million square feet of commercial space and 1,400 residential units.

Governors Island could be home to nearly 4 million square feet of new development. The City Council voted in favor of rezoning the south end of the island, which will allow for the construction of university space, hotels, offices, research facilities and retail across 34 acres. New development would be located within two areas that are home to vacant Coast Guard buildings. Changes to the rezoning included a cap on building heights, and limitations on the amount of office and hotel space. Planned development includes a research center that would be anchored by a yet-to-be selected institution focused on studying the impacts of climate change.

The City Council voted overwhelmingly to pass a bill that would raise the value of rental vouchers available to homeless New Yorkers. The bill, sponsored by Council member Stephen Levin, would bring the subsidies afforded by the city’s Family Homelessness & Eviction Prevention Supplement (or FHEPS) voucher up to federal Section 8 standards. Values would increase to $1,945 for a one-bedroom or $2,217 for a two-bedroom.

Certain residential and commercial tenants can now avoid eviction until at least Aug. 31. The state Senate and Assembly approved a measure that retroactively extends two recently expired laws that restrict evictions of residential and commercial tenants, as well as foreclosures on small landlords and businesses. Those seeking such protections must fill out hardship declaration forms, but do not have to submit proof that they are unable to pay.

New construction filings between January and March had 407 new building filings. That’s a 13% increase from the first quarter of 2020. But while the number of projects filed is up, the square footage of those new filings is down. Those applications total 5.4 million square feet, the smallest number reported since the fourth quarter of 2010. Most of the filings were for projects smaller than 300,000 square feet.

Mayor Bill de Blasio’s announced that New York would be back at “full strength’’ by July 1, with stores, offices and theaters reopening, the volume has since remained steady, day after day.

Employees who have been working remotely from outside of the city are searching for apartments. Retail brokers anticipate a surge in leasing as stores and restaurants, cocktail bars and cafes gear up to serve returning workers.

An $850 million development planned for the South Street Seaport Historic District was approved. The developers will provide long-term financial support for the Seaport Museum.

The proposal to rezone Soho and Noho is moving forward, despite a lawsuit claiming the plan cannot proceed if the city doesn’t host in-person hearings. The City Planning Commission certified the application to rezone the neighborhoods, officially kickstarting the public land use review process. The timing of the certification means the rezoning could make it through the Uniform Land Use Review Procedure before the end of the de Blasio administration, as long as it doesn’t face further delays. The proposal would apply to 56 blocks in the neighborhood, eliminating restrictions that permit only light manufacturing use on ground floors. It could also pave the way for more than 3,500 residential units, of which as many as 1,118 could be set aside as affordable. (The city has identified only 26 sites that are likely to be developed in the next 10 years, which would yield an estimated 1,829 units, of which 382 to 573 would be affordable.)

Two rezonings, held up by the same judge for similar reasons, can now both move forward.. A Brooklyn judge Levine lifted restraining order blocking the rezoning of a former spice factory at 960 Franklin Avenue on the condition that the developer works with Community Board 9 to provide an outdoor venue and virtual access to hearings on the matter. Levine removed an order that was holding up a proposal to rezone 80 blocks in Gowanus, after approving the city’s plan to hold an outdoor hearing in J.J. Byrne Park next month.

The state’s highest court tossed out a lawsuit alleging that the proposed men's shelter site, the shuttered Park Savoy Hotel at 158 West 58th Street, was unfit for housing.

The Wing is attempting a comeback. The co-working space catered toward women fully re-opened its New York City locations.

Urban Outfitters at 526 Avenue Of The Americas is now closed and has been at 526 Sixth Avenue since 1999. It leased the 26,500-square-foot space from Mosbacher Properties Group.

Facebook is in a push to get workers back into offices and informed workers that its Manhattan offices will open July 12 at 25% capacity. Employees that have been working remotely since those offices closed last spring will be able to continue doing so until a month after a return to 50% capacity. For its largest offices, Facebook does not expect that to happen until early September.

The Time Warner Center will now be called the Deutsche Bank Center. Related Companies, the owner of the two-tower complex on Columbus Circle, made the renaming official by adding new signage to the building.

Jeff Winick is being sued by the IRS for not paying his taxes. In a complaint, the IRS says that Winick underpaid taxes owed on approximately $23 million in income between 2012 and 2016, and avoided paying by renting and leasing his homes and cars and transferring assets to his daughter and other friends. Winick filed for Chapter 7 bankruptcy, which the IRS alleges was an attempt to avoid paying millions of dollars that he owes the agency.

St. Francis College signed a lease with Tishman Speyer for 255,000 square feet at the Wheeler, above the landmarked Macy’s building in Downtown Brooklyn. The 30-year deal partially replaces the long-term lease that the private Whittle School and Studios signed in early 2020, to occupy all 622,000 square feet at the Wheeler. The 20-year agreement has since fallen through; the college’s lease was with Tishman directly.

Alloy Development’s Downtown Brooklyn skyscraper is undergoing some changes. The developer is scrapping 100,000 square feet of office space at the first phase of 80 Flatbush Avenue and instead adding more apartments. The total number of units will rise from 257 to 441, about 45 of which will be affordable.

A complaint cites high levels of lead paint and asbestos throughout 27 West 11th Street, toxins that could prove hazardous for the property’s elderly residents once construction begins.

The Chetrit Group is a month behind on payments for the $76.5 million mortgage backed by its mixed-use buildings at 427 and 459 Broadway in Soho. The problem is a drop in tenant occupancy and an increase in real estate taxes.

Restaurants inside the Hudson Yards mall have struggled through the pandemic, but now a food fight has erupted outside, pitting street vendors against developer Related Companies and the city

The leisure and hospitality sector led employment gains for the third straight month, bringing back 330,000 workers in April. Restaurants and bars did more than half the hiring, while recreation centers (such as amusement parks and casinos) hired 73,000 people and lodgings added 50,000 positions.

The Trump firm could pay nearly $1.7 million less on property taxes for the office tower at 40 Wall Street, after the building’s value slumped 29% to about $130 million for the coming fiscal year.

New York City’s new building emission caps which come into effect in 2024 could impose major fines on 32 Sixth Avenue and 60 Hudson. 32 Sixth Avenue could face $2.8 million in fines. 60 Hudson Street could be on the hook for nearly $4.6 million in fines that same year. The Chelsea Hotel has filed a lawsuit against the city, the Department of Buildings and the Department of Housing Preservation and Development, alleging that the delays cost them at least $100 million.

SL Green will dedicate the entire 54th floor of One Vanderbuilt, its 58-story Midtown East skyscraper, to flexible offices that will be known as Altus Suites. The offices range in size from 6,300 to 7,500 square feet, and tenants will have access to the building’s high-end amenities, including a lounge, valet parking and fully stock pantries.

Tishman Speyer announced that it would open two locations of its own coworking brand, Studio at 11 West 42nd Street and 175 Varick Street.

Industrious acquired the listings platform and branding rights of Breather, the Canadian rent-by-the-day company that folded its flexible-office business last year. Industrious bought Beather’s intellectual property, technology and data assets. It has a listings platform that includes some 700 on-demand workspaces. The purchase price was $3 million.

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