Inside 3eleven, Manhattan's Largest New Multifamily Building
Walking through the nearly complete 60-story 3eleven apartment building his firm developed in West Chelsea, Douglaston Development President Steven Charno is grateful for its timing.
“The most important thing that we were able to do in this building, without any government subsidy besides the tax abatement, was that we were able to create 250 affordable homes,” Charno told Bisnow Thursday on a tour of the project. “If we were starting today, we couldn't do a building like this because we couldn't finish it in three and a half years.”
Although the housing crisis is high on Mayor Eric Adams and Gov. Kathy Hochul's agendas this year, industry leaders have spent several months ringing alarm bells about the lack of new apartment units in the city’s construction pipeline. There was a 68% decline in new application filings for multifamily housing during the third quarter of 2022, according to the Real Estate Board of New York.
The vast majority of proposed dwellings filed in 2022 took place before mid-June when the state’s 421-a tax abatement expired. Any project that received the abatement has to be complete by June 2026. The rush of new filings came after a period of depressed construction, reducing the competition for new rental buildings like 3eleven.
“There's not a ton of new rental product coming online in Manhattan right now,” Charno said. “So with the pipeline, we've been doing very good. There's not a ton of product we're competing against.”
The 938-unit building is the largest new multifamily project in Manhattan, and because it was built using the Affordable Housing New York tax abatement — the rebranded form of 421-a — 25% of its units are income-restricted.
Approximately 45% of the apartments are complete, and about one-fifth of those are already leased, Sammy Ahmed, Clinton Management’s regional leasing manager, told Bisnow. His department does between seven and eight building tours a day during the week, he said, and often as high as 17 on a weekend day. Leasing at the 690-foot building launched in August.
Studios, one-bedroom and two-bedroom apartments in 3eleven have expansive windows, revealing views of Hudson Yards, the Empire State Building and the Hudson River. The target demographic for the building is tech workers employed by Google, Amazon, BlackRock and L’Oreal, all of which have large offices nearby. Clinton and Douglaston have reached out to the companies’ hiring departments directly to advertise their apartments to incoming employees.
The majority of units are market-rate, with rents starting at $5,100 per month and reaching as high as $6,700 — well above the record Manhattan median rents set last summer. Even with the recent spate of tech layoffs, demand for the building’s units has remained consistent, Ahmed said.
“We're still seeing a lot of people coming in from overseas, people transferring into the city for work, so [those layoffs] really haven't affected us yet,” he said. “Steven was generous enough to give us two months free on a 14-month lease. That gave us everything we needed to close deals. Really, that's been enough.”
The other component that Charno feels allows Douglaston to command luxury rents is the amenities at the FXCollaborative-designed building. 3eleven features 60K SF of amenity space, including multiple dog runs and rooftop decks, an outdoor swimming pool with views of the Hudson, workspaces, game rooms, cabanas with private decks and grills that residents can reserve, an extensive gym in the basement and a 42nd-floor lounge with a kitchen for use by residents.
“The thinking is, you're gonna pay a lot for your apartment, but there's all these other places to go and build the community and hang with your friends,” Charno said.
Douglaston started working on 3eleven more than five years ago. It signed a ground lease on the site at 601 West 29th St. in November 2018 with the landowner, a private family, for $129.7M after news first broke about the project in April 2017.
Douglaston had to rezone the site, also called 311 11th Ave., from manufacturing to residential, a process that took more than 2.5 years, Charno said. It was originally proposed as a 1.1M SF, two-tower project alongside 606 West 30th St. That building, being developed by Lalezarian Properties, topped out in December, New York YIMBY reported.
But rezoning wasn’t the only challenge for Douglaston: construction was underway in 2020 when the pandemic shut down every industry across the country. After a minor delay, the developer’s work, largely outdoors at that point, was approved as an emergency and allowed to progress.
However, supply chain issues kept throwing up hurdles.
“These windows are made in Colombia, and one day the factories just closed because of Covid,” Charno said.
Douglaston ended up working with the Colombian factory via video tours, and the incident made the developer hypervigilant about making sure other materials it needed would be in place.
After hearing there was a shortage of appliances, Douglaston bought 15 floors’ worth of appliances and stored them in what is now the building’s parking garage.
“In our business, stuff goes wrong every five minutes,” Charno said.“ We've been doing this for a long time, and what was so interesting is how folks that hadn't had adversity were just totally unprepared to deal with it. What I think we do in our company is we're constantly overcoming challenges.”
Even now, almost three years since the start of the pandemic, Charno’s advice for developers is to start work on every element of a building — from applying for permissions from government agencies to buying building components — earlier than they may have in the past.
“Things that you would maybe start three months in advance I would now start six months in advance,” he said.