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September 2008

September 2008 » Market Analysis » NY New Developments

September 2008 New York New Developments


New Developments


Macklowe Properties demolished the old Drake Hotel at Park Avenue and 56th Street but has not started building 440 Park Avenue yet. Extell still has not filed plans for its West 57th and 58th Street project, which was supposed to be a 50-story hotel-condo. Starwood Capital cleared a low-rise fur shop between the Economist building and the Buckingham Hotel; plans for a Crillon hotel haven not been realized.

TriBeach has stopped work on its Eighth Avenue 37-story hotel-condo building, leaving a crater in two buildings on the lot between 46th and 47th streets. Although the plans have not been approved yet, demolition has begun and pavement plans were filed two months ago.

The Bloomberg administration has re-zoned 20% of the city's industrially zoned land. Originally, the re-zonings were supposed to promote office development, but almost all of the land has been converted to residential use.

Commercial property owners could borrow 80% of their property's value during the boom, but now have trouble getting more than 50%.

The Museum of Arts and Design is scheduled to open at 2 Columbus Circle on September 27. The nine-story, 54,000-square-foot building is about triple the size of the museum's last at West 53rd Street, and will include a 155-seat theater, a restaurant and a permanent collection display.

The New York City Planning Commission is scheduled to vote on re-zoning the area from 125th to 127th streets, between second and Third avenues, for a 1.7 million-square-foot mixed-use complex. The city owns 81% of the land designated for the project. The council is expected to pass the rezoning proposal, and developers Vornado Realty Trust, Thor Equities and General Growth Properties are already bidding on the project.

Arby's, a fast food chain, whose New York City presence includes three Queens outposts,plan to open 41 new locations in Manhattan, Brooklyn and the Bronx in the next decade.

Financing for commercial real estate is becoming increasingly difficult to secure. As a result, investment sales activity for Manhattan's commercial properties worth at least $10 million fell 59 percent in the second quarter. Investors purchased many of the assets. Loans covered an average of 50 to 70 percent of building values this year, down from 70 to 90 percent in 2007.

Sheldon Solow spent years assembling the parcels on the Consolidated Edison site on the East River for his $4 billion mixed-use project. In a legal oddity that city officials said may be unique in Manhattan, a small portion of the site is owned by the city through a 1,000-year lease drafted back in 1861. Solow controls the property through a long-term lease from the city, however, and officials said he has what amounts to full ownership. Solow agreed to acquire the entire nine acre site, along First Avenue, between 35th and 41st streets, from Con Edison in 2000 for $630 million. He has plans to build seven towers with 6.1 million square feet of commercial and residential space.

Coney Island's Astroland will reopen next summer if Thor Equities renews its lease.

Hotel occupancy rates are climbing and the industry is creating new jobs in retail and city services. But as the dollar starts to rebound against other currencies, some worry that the influx of foreigners may slow.

The city Economic Development Corp. states it has fixed problems that has threatened its plan to move a major salvage yard from Willets Point to College Point, but now College Point residents are protesting the move. The city wanted to move the Sambucci Bros. Auto Salvage to a site within the College Point Corporate Park, which is governed by an Urban Renewal Plan that prohibits salvage yards. The EDC is in the process of relocating businesses to make way for a major redevelopment of Willets Point that includes plans for a hotel, convention center, housing and retail and office space.

75 Morton Street Parents, preservationists and now the city are asking New York State to turn a former West Village warehouse into a public school. The city Department of Education sent a letter yesterday to the Empire State Development Corp. saying it is interested in turning 75 Morton Street into a middle school. The state plans to sell the building, which houses the New York State Office of Mental Retardation and Developmental Disabilities, a facility that is being moved.

Gary Barnett of Extell Development wants to change the development restrictions that were reworked and rehashed 16 years ago for Riverside South.. Extell purchased a portion of the property rezoned for Riverside South's 6,000 residential units and commercial in mid-2005 for $1.76 billion. Barnett is looking for public approval of a giant complex of residential buildings on the southern base of the development.

Accounting and consulting firm BDO Seidman leased 121,441 square feet at 100 Park Avenue.

Frankie and Johnny's, a Times Square area steakhouse, will be demolished to make way for a Related Companies/Boston Properties tower planned on the east side of Eighth Avenue between 45th and 46th streets. Next door at 726 Eighth Avenue will be cleared for the 850,000-square-foot tower.

The Nets basketball arena at Atlantic Yards might not be ready until 2011, a year later than Forest City Ratner had hoped. A state lawsuit has been filed against the project by Develop Don't Destroy Brooklyn over the use of eminent domain.

New York City's foreclosure rate was up 67 percent last month compared to July 2007. The city recorded 338 foreclosures in July. While foreclosures fell 5 percent in Queens from 188 in June, the borough still had the city's highest number of foreclosures at 178. Staten Island saw the highest increase of foreclosures compared to the prior month, up 86 percent to 54. Brooklyn's foreclosures increased from 57 in June to 63 in July, and Manhattan foreclosures rose from 9 to 14. Between June and July in the Bronx, foreclosures decreased from 36 to 29.
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