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September 2018

September 2018 » Market Analysis » NY New Developments

September 2018 New York New Developments

New York Major Developments:

Manhattan dominated the list of New York City’s top 10 largest real estate projects in July. Marx Development Group’s roughly 213,000-square-foot hotel and retail project at 450 11th Avenue in Hudson Yards.

Covenant House is planning a 12-story, 60-unit building in Hudson Yards about 53,000 square feet. Its new project would replace a smaller eight-story youth homeless shelter currently on the site of 460 West 41st Street.

323 East 61st Street from the William Macklowe Company will span about 50,000 square feet and stand six stories and 74 feet tall.

WeWork just signed a 258,344-square-foot lease at 21 Penn Plaza. They took 10 floors of the 16-story building. .

Vornado Realty Trust refinanced the retail building at 4 Union Square South with a $120 million loan. Vornado redeveloped the building in 2005 into a 200,000-square-foot shopping center.

Liberty State Park’s 1,212 acres are allotted for public use but companies have pitched ideas to attract high-end crowds. Jersey City’s Sam Pesin, who led the park’s creation, is pushing for a law to keep the space off limits.

Midtown Equities is planning to take a 30% stake in the Battery Maritime Building hotel project. The equity stake would put construction on the conversion project back on track and could be completed in 2020. .

Some of New York’s developers are looking to go green, a plan to cut energy use in the city’s larger buildings by 20% by 2030. The plan would include the more than 50,000 buildings in the city of at least 25,000 square feet.

Tiffany & Co. announced a major renovation and expansion plan of its flagship Manhattan store at 6 East 57th Street. The overhaul could cost $250 million. Construction is set to start next year and conclude by the fourth quarter of 2021. , Tiffany will temporarily move some of its operations into the building next door.

Columbia Property Trust is in talks to join Normandy Real Estate Partners on its Greenwich Village office project and to buy Ares Management’s 50% stake in the project at 799 Broadway. Normandy plans to demolish the six-story building and build a 182,200-square-foot, glass-and-steel office building. Normandy and Ares bought the site in 2016 for $101 million from Cambridge Associates.

One out of five dwelling units currently under construction in New York City is in a hotel, the highest proportion since 2013. From 8,000 in 2013 to more than 20,000 today.

When the Carlyle Group agreed to move to One Vanderbilt, SL Green Realty sweetened the deal by offering to pay for the company’s old lease that could cost $100 million for their lease at 520 Madison Avenue, which is set to expire in 2031. The Carlyle Group plans to move into One Vanderbilt in 2020.

Dalan Management recapitalized 10-12 East 33rd Street in a deal that values the properties at more than $54 million. Marcus Partners paid $54.5 million to buy the adjacent 11-story buildings at 10-12 East 33rd Street from Dalan Management.

Wharton Properties landed $50 million to refinance 29 West 34th Street. Landesbank Hessen-Thüringen, also known as Heleba, provided the financing package, which includes $49.4 million in existing loans and $562,500 in new debt. 29 West 34th Street is a three-story retail building whose tenants include Aldo and Geox.

Brookfield Asset Management secured an option to buy the land under 666 Fifth Avenue from Kushner Companies as part of a deal to lease the office tower for 99 years.

The Moinian Group has still not landed an anchor for its planned 3 Hudson Boulevard. The developer recently signaled that he’s shaking up his strategy at the project, which sits at the corner of 11th Avenue and 34th Street. Recently, the developer fired and replaced his leasing team, scaled back the size of tower, scrapped plans for a residential component and hired a team to secure $3 billion in debt and equity.

A city arbitrator decided a rent dispute between Barneys and Ashkenazy Acquisition, declaring the retailer’s new annual bill to be $30 million. The new rent represents double Barneys current rent and, with property taxes factored in, coming to an estimated total of $44 million per year. The hike is still only half of what Ashkenazy had been seeking. The landlord wanted to bump Barneys rent up to $60 million for the 275,000-square-foot space at 660 Madison Avenue. The retailer has a 20-year lease with Ashkenazy for their flagship store’s Upper East Side location.

Rotem Rosen plans to raise up to $72 million in Israel to finance the purchase of the Hotel Indigo for $162.5 million from Brack Capital and InterContinental Hotels Group. To fund the purchase, MRR filed a prospectus for a secured bond offer of up to $72 million in Tel Aviv with bondholders taking the senior position on the 294-key hotel. MRR will seek to raise up to 45% of the hotel’s value, and contribute the rest of the purchase price from the company’s capital. The hotel, located at 171 Ludlow Street, took a decade to build and opened in 2015. Two years later, Brack and InterContinental put it on the market for $176 million.

Aetna will be consolidating some of its existing New York City offices in Soho. The insurance company signed a lease for a little more than 100,000 square feet at Stellar Management’s One Soho Square.

The luxury goods store Loro Piana has leased 3,000 square feet at 3 Ninth Avenue, right by Hermès 10,000-square-foot lease last year. The store will be split between 1,700 square feet on the ground level and 1,300 square feet on the lower level. The asking price for the ground floor was $400 a square foot.

Tribeca Associates got a $105 million loan for a newly completed Moxy Hotel at 143 Fulton Street between Broadway and Nassau Street. It is a 30-story tower with 298 rooms. The bottom two floors, which face Fulton Street, have been earmarked for retail. The third floor will contain a bar.

The Simons Foundation plans to buy the office portion of RFR Holdings‘ 160 Fifth Avenue for $185 million. The building contains 150,000-square-foot space and is paying $1,500 per square foot. Simons already leases about 76,000 square feet of office space at 160 Fifth Avenue.

The City Council’s land use committee approved a 21-story tech building to Union Square, aka the Union Square Tech Training Center and comes from RAL Development. It will span 240,000 square feet at 124 East 14th Street. Tech training nonprofit Civic Hall will be the anchor tenant on the fourth through seventh floors, and the second through fourth floors will contain 40,000 square feet for workforce development programs. The building will also include ground-floor retail and a food hall. Floors eight through 12 will have affordable office space for companies in their early stages with rents around $50 per square foot, while the top eight floors will be for market-rate office space.

A new jail could be on its way to Lower Manhattan as part of the city’s plan to shut Rikers Island. The jail would rise at 80 Centre Street, which currently houses the city’s marriage bureau and offices for the Manhattan District Attorney, along with other government agencies. The building spans 700,000 square feet and is nine stories tall, but if it were converted into a jail, it would be completely gutted and could stand 40 stories tall. The complex could include affordable housing too.

This month’s top office leases totaled 2.3 million square feet, greater than last month’s 1.7 million square feet.

  1. 1199 National Benefit and Pension Funds inked a lease for 455,461 square feet of office space at 330 West 42nd Street.
  2. Evercore, an investment firm, renewed and expanded its lease for 350,000 square feet of office space at 55 East 52nd Street.
  3. Pfizer, the pharmaceutical company, inked a five-year lease for 350,000 square feet of office space at 219 East 42nd Street, a building which it formerly owned. David Werner and Alexandria Real Estate Equities are the landlords of the building.
  4. J. Crew, the clothing brand, signed a lease for 324,658 square feet at 225 Liberty Street.
  5. LinkedIn, the professional social network, renewed and expanded its seven-and-a-half-year lease for 312,947 square feet at 350 Fifth Avenue. Empire State Realty Trust is the landlord of the building.
  6. Spell, the tech startup, signed a lease for 181,550 square feet at 2 Gansevoort Street. William Kaufman Organization is the landlord of the building.
  7. McGraw-Hill, the education company, inked a lease for 136,176 square feet at 1325 Sixth Avenue. The building's landlord is Paramount Group.
  8. Wolters Kluwer, the publisher, signed a lease for 130,000 square feet of office space at 28 Liberty Street. The building’s landlord is Fosun International.
  9. Spaces, the co-working company, signed on for 100,613 square feet of office space at 287 Park Avenue South.

This month’s top 10 retail leasing deals totaled 171,900 square feet, down from 516,800 square feet last month.

  1. Toyota’s renewal for 300,000 square feet of space at 660 12th Avenue.
  2. R13 Denim, the denim retailer, signed a 10-year lease for 11,350 square feet of space at 34 Howard Street.
  3. Five Below, the discount retailer, inked a lease for 10,800 square feet at 530 Fifth Avenue. The landlord of the property is General Growth Properties.
  4. Rumble Fitness II, the gym, signed on for a 8,383 square feet of space at 49 West 23rd Street.
  5. FitHouse, a gym, inked a 10-year lease for 6,800 square feet at 20 West 14th Street.
  6. Anna Kim, the celebrity chef, signed a lease for 6,300 square feet of retail space at 8 West 28th Street for her upcoming restaurant.
  7. Connect One Bank inked a lease for 6,249 square feet at 551 Madison Avenue.
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