By: Ilana Siyance
One developer is betting that demand for office space in the Big Apple will recover by 2024.
For now, thanks to the effects of the pandemic, office spaces in Manhattan have historically high vacancies, and lower asking rents. Developers from the team of Alchemy-ABR Investment Partners and Cain International, however, are forging ahead with plans to construct a gaudy new office building in Manhattan. As reported by Crain’s NY, the developers are confident NYC will be ready for it by the time of its slated completion in 2024.
The planned 26-story tower is located on Billionaires Row at 125 West 57th St. The site purchase was completed in June for $130 million, as per property records. The deal was first agreed upon, back in February, before the COVID-19 pandemic had ravaged New York City real estate. The company’s resolve to move ahead with the project is still intact though. “Did we ever think about walking? We certainly assessed the situation,” said Eric Poretsky, a senior managing director with Cain. “But we believed in the product. And it’s in an exceptional location.”
The Midtown site is between Sixth and Seventh Avenue, just steps away from the subway stations, easily accessing the N, Q and F trains. The proposed building is near Central Park, in a neighborhood which already boasts top office addresses—including the General Motors Building, the Solow Building and Carnegie Hall Tower. The area has not had a new building in some time though. “There was just no new product,” said Poretsky, adding his hopes that small financial firms, tech-finance companies and family offices will be tenants for the new building.
The developer struck a deal with religious institution Calvary Baptist Church, which has been at the site since 1883 and in the current building since 1931. Cain, which is funding most of the equity for the project, promised to construct a new church for Calvary, in the new building’s bottom six floors. The offices will be on floors 10 through 26. The building, which is slated to cost $330 million, will also feature a 4,000-square-foot tenants lounge on the on the seventh floor.
Designed by FXCollaborative, the building will stand 420 feet above ground and comprise approximately 260,000 square feet. The developers filed permits for the space back in November 2019, to demolish the current building and create a development with 139,736 square feet of space designated for commercial space, and 47,660 square feet for community facility space.