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November 2012

November 2012 » Market Analysis » NY New Developments

November 2012 New York New Developments


New Developments

The Chrysler Building just got a little greener. The Owner has received a LEED gold certification for the 1.2 million-square-foot office tower. Tishman spent two years updating the building’s energy, waste, water and maintenance systems. The upgrades include new plumbing fixtures that will cut the property’s water consumption by 64 percent; a waste-management policy that will ensure 81 percent of the building’s waste is recycled; and a 21 percent reduction in energy usage.
The city’s plan to sell of three historic but outdated office buildings in Lower Manhattan, all of which would likely become luxury housing or hotels, has hit a another snag. Community representatives in the City Hall area object to the plan unless it includes provisions for a school, community center or affordable housing. The City Council’s subcommittee on planning, dispositions and concessions will gather soon at a hearing to discuss the sale of the properties at 22 Reade Street and 49-51 Chambers Street. The disposition of the third building, located at 346 Broadway, was approved in 1998.
Related Companies has reached a preliminary agreement to get roughly $400 million in construction financing for a Hudson Yards office tower. The lenders include Bank of America and JP Morgan Chase. The loan is considered the last hurdle in developing the 1.7 million-square-foot tower, which will kick off the Hudson Yards project with luxury goods retailer Coach as an anchor tenant. The building will be located at 30th Street and 10th Avenue.
Real estate players with interests in Midtown are not quite sure how to react to the city’s sweeping Midtown East rezoning proposal, which would allow for the construction of taller buildings in the area. The rezoning could either help or harm the value of a company’s investment.
As Trinity Real Estate looks to transform Hudson Square into a round-the-clock hotspot, the landlord has finalized a lease in the neighborhood with Medidata Solutions, a company that provides cloud-based medical data. Medidata is taking almost 100,000 square feet of space at Trinity’s 350 Hudson Street. The technology firm will likely take three full floors at the Hudson Square area building.
Virgin Group seems to be actively scouting locations in New York to launch its four-star Virgin Hotel brand. They want its NYC hotel to be in a “neighborhood-centric” area and promote an “authentic” New York experience. They are looking for an area that has the energy of big market areas like Times Square or distinct neighborhoods with real communities; such as: Soho and the Meatpacking District, for example where they believe they would be a perfect fit.
Montefiore Medical Center has reached an agreement Simone Development, to build out and occupy a new, 11-story tower in the Bronx. The 280,000-square-foot building will be part of Simone’s Hutchinson Metro Center, and should be complete by the third quarter of 2014. The new tower will include an ambulatory surgery center, an advanced imaging center, an onsite laboratory and pharmacy, and primary and specialty care practices.
A re-zoning proposal from the Department of City Planning has architects and developers eager to make changes to Grand Central Station and its surrounding area. The DCP plan would re-zone the Grand Central area to allow for new office towers, in exchange for a required donation from developers to make infrastructure upgrades that could include building additional access points to Grand Central’s subway platforms and a pedestrian mall on Vanderbilt Avenue. Thus far, three architecture firms have been asked to submit proposal to redesign the area. Their designs will be unveiled at a soon to be held conference.
Brookfield Financial has a new name in store for the World Financial Center located in Lower Manhattan. The property will bear the name Brookfield Place and the change appears to be part of an effort to guide the complex’s image away from a place for financial tenants in a time of low leasing demand. It’s not going to happen overnight but Brookfield plans to phase in the new name increasingly over time.
Plans for a mixed-use development at the site of failed Yankee Stadium parking lots have stalled and the city is no longer pursuing the project. The plan had originally called for Jackson Development and Joy Construction to bring retail shops and 550 units of affordable housing to the site, a move the could have pulled Bronx Parking Development, the company that owns and operates the Yankee Stadium parking system, out of bankruptcy.
The Rainbow Room at Rockefeller Center just became the city’s 115th interior landmark with a unanimous vote by the Landmarks Preservation Commission. The famed Art Deco-style supper club set atop 30 Rock offered dining and dancing and was home to some of the city’s most lavish events, before it closed in 2009. The Cipriani restaurant family, the operators of the space, left due to high rents.
Riding a trend that is propelling the Midtown South office-leasing market, Microsoft is in talks to lease a 22,000-square-foot space at 641 Sixth Avenue. The deal would be for the entire 7th floor. It’s not clear how Microsoft would use the space. The company already has its New York headquarters at 1290 Sixth Avenue; the company occupies some 250,000 square feet there.
The Chetrit Group has closed on its purchase of a Hudson Yards development site, despite an ongoing legal battle at the property between the site’s former owner and its lender. Chetrit, the company behind the ongoing renovation of the Hotel Chelsea, paid $26.5 million for the four adjacent lots at 541¬–545 West 37th Street and 540-544 West 38th Street. The site is zoned for dense commercial and limited residential uses. It has 172,813 square feet of “as-of-right” development potential, and up to 373,275 square feet of development potential through additional incentives.
The Dey Street concourse, which will connect the Fulton Center complex stop at Broadway and the Cortland Street station at the edge of the World Trade Center site, is almost complete. However, it will not open until 2015. The concourse will stay closed until the new World Trade Center and traffic-heavy PATH connection are completed.
A new frozen yogurt shop has inked a lease to open up a Greenwich Village outpost, its first in the U.S. Yooglers Frozen Yogurt, a Spanish dessert outfit, will take approximately 1,500 sf at 791 Broadway, at East 10th Street, for a flagship store and that is just the beginning of a planned expansion into the New York City market.
Lincoln Center has reached the end of its six-year, $1.2 billion redevelopment project. A ceremony will mark the project’s completion, and they will open the President’s Bridge and dedicate a wall in honor of project’s benefactors. The project was completed on time and under its budget.
Kenny’s Castaways, a historic a Greenwich Village club that has hosted acts from Patti Smith to the Fugees, will close its doors, joining a number of Manhattan music venues that have shut their doors recently, due to rising costs. The rents have become so astronomical in that area that mom-and-pop places just cannot make it happen. Rent at the venue’s 157 Bleecker Street space has more than doubled in the last five years.
The advertising and media company Group M seems to be in talks to lease a large space at 3 World Trade Center. The prospective lease inside Silverstein Properties’ Richard Rodgers-designed, 2.8 million square-foot tower would be for around 550,000 square feet, large enough for the developer to qualify for $600 million in public benefits. Silverstein can only be eligible for city, state and Port Authority funding once a 400,000 lease deal is struck for space within the tower. UBS and Morgan Stanley both considered large leases in 3 World Trade Center, but financial sector downsizing scuttled the deals.
Pritzker Prize-winning starchitect Norman Foster’s firm, Foster + Partners, was selected to design the 650,000-square-foot office building that will be constructed at 425 Park Avenue. Construction is set to begin on the first full-block office project on the Park Avenue Midtown stretch in almost 50 years in 2015, and is slated to be completed two years after that.
Two low-rise Meatpacking District buildings, owned by William Gottlieb Real Estate, are set to undergo an extensive redevelopment. The buildings, one of which houses the French bistro Pastis, will soon contain 108,000 square feet of office and flagship retail space. William Gottlieb Real Estate is joining Aurora Capital Associates and architect Peter Wormser to modernize the 1847 Greek Revival-style row house and its neighboring 1870s-era property, both of which were once owned by John Jacob Astor and the Astor family into the 1940s.
The City Council’s Landmarks committee has approved an expansion of the Upper West Side’s historic district. The district will expand to include blocks between Broadway and Riverside Drive, between 79th and 87th streets. It is one of several proposed expansions of the historic districts on the Upper West Side. The City Council, in a full vote, is expected to approve the expansion, approved by the Landmarks Preservation Commission, as well.
The Novotel Times Square hotel has begun an $85 million facelift that should be completed by September 2013. The work that recently began focuses on infrastructural improvements, namely work to the heating and cooling systems. Early 2013 is when guest room and public space renovations will kick off. The aim is to cash in on higher room rates. Currently rates span $250 to $300 nightly depending on the season.
Danforth Development Partners has brought on architect Ariel Aufgang to handle the design of a $143 million commercial development on 125th Street in Harlem, with emphasis on historic preservation. The 300,000-square-foot project will include two 26-story office towers, a 210-room hotel and a 230-unit apartment building above the historic Victoria Theater. Aufgang will also be focused on restoring the theater’s original 1917 terra cotta facade and decorative lobby.
Howard Hughes Corp. is revising its design for a proposed shopping mall on Pier 17. The new design would split the rectangular mall in two, allowing natural light and rain to shine through the building’s center.
A South Bronx site held by a would-be developer for 17 years will finally be developed as a mixed-use development. The city plans to break ground on a mixed-income residential and commercial development which will be known as Crossroads Plaza, on the Prospect Avenue site where Stanley Schlein held development rights.
A commercial building with alleged ties to the Iranian government is attempting to lease out 140,000 square feet of vacant space. In 2008, the 36-story 650 Fifth Avenue building near Rockefeller Center, formerly known as the Piaget Building, was alleged by the U.S. Justice Department to be 40 percent owned by Assa Corporation: a shell company the government believed was run by Iran’s Bank Melli. Bank Melli is accused of being a backer of Iran’s nuclear and weapons programs, with ties to the Iranian Revolutionary Guard Corps and the Quds Force.
Construction has begun at a mixed-use project now called Canal Tower, at 86 Canal Street, in Chinatown. The site has filed plans with the Department of Buildings for a 12-story residential tower, and they have been approved. Signage indicated a December 2013 completion date and the plans show 89 dwelling units with 900 square-feet earmarked for community use. The development will also include commercial space, but exactly how much and in what configurations was not known.
The Landmarks Preservation Commission approved slightly modified version of the East Village/Lower East Side Historic District. The territory covers 330 buildings across 15 blocks bounded by Avenue A and the Bowery and St. Mark’s Place and 2nd Street.
A New York State Supreme Court panel has upheld a summary judgment against developers Laurence Gluck, Steve Witkoff and Westbrook Partners for failing to close on an office building at 405 Park Avenue in 2009. The decision brings to a close a three-year legal saga that saw the three developers, working under a partnership named 405 Park LLC, pitted against the building’s owner Donerail Corporation. The partnership made a deal with Donerail to buy the building in 2007, but later reneged. The dispute centered on a $38.5 million deposit paid by 405 Park LLC to Donerail prior to the arranged closing date. Donerail, which still owns the 17-story office building, can now retain the deposit, as per the judge order.
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