8 Major Office Repositioning Projects in NYC
Developers are banking on continued demand as they sink millions into high-profile repositions for office stock. Here's a look at eight of the biggest office makeover projects underway in the city.
1. The Brooklyn Navy Yard's Building 77
The city poured $140M into this giant 1M SF concrete box as part of the ongoing redevelopment of the Brooklyn Navy Yard, adding windows where there were hardly any before, as well as overhauling the interior. When the project wraps up later this year, the building will be mostly office space, along with co-working spaces, private event spaces and a huge ground-floor food hall.
Asking rent for the office penthouse on the top few floors is about $40/SF and goes down for lower floors. Brokers marketing the space say the city's Relocation and Employment Assistance Program tax credit and other benefits could shave $18/SF to $21/SF off the final price per SF.
2. 28 Liberty
Fosun, a huge Chinese investment company, bought this 2.2M SF building from JPMorgan back in 2013 for $725M. In 2015, the firm began a top-to-bottom reposition that will create 200k SF of ground-floor and below-grade retail, overhaul the building’s infrastructure, and add a revamped outdoor plaza and an exclusive event and catering space on the 60th floor. All told the renovations will cost $150M to $200M.
Fosun execs say they’re already swamped with tenant proposals for the retail and 800k SF of office space that’ll be free when the reposition wraps up in 2018. Sources say asking rent for the ground-floor retail is about $400/SF, while the lower levels are about $100/SF. The office space runs from about $50/SF to $80/SF.
3. The Verizon Building
The city’s ugliest building is about to get a little less so. Sabey Data Center Properties purchased this former Verizon switchboard center at 375 Pearl St for $120M in 2011 along with developer Young Woo as a junior partner, and last year work began on a massive facelift. Three sides of the Brutalist concrete behemoth will get glass façades, and 500k SF will be converted to office space when the project wraps up later this year. The rest of the building’s 1.1M SF will be used as a data center.
Last year, the NYPD took 18k SF, and the city’s Department of Finance is reportedly eyeing 125k SF. Asking rents range from $45/SF to $51/SF.
4. The Pioneer Building
Quinlan Development and Building and Land Technology picked up this 260k SF storage facility last year for $89M. Their plan is to turn it into the first modern brick-and-beam office conversion in Downtown Brooklyn, when it opens in Q3 of this year. When it's done the building will have 25k SF of retail space and a new rooftop deck, in addition to the new office space.
Rent will be about $55/SF, and the landlords are hoping to lure in tenants with incentives from the Relocations and Employment Assistance Program, which could save tenants about $3k per employee per year off their tax bill.
5. 180 Maiden Lane
Norman Sturner’s MHP Real Estate Services and Clarion Partners closed on this 1.2M SF Class-A office tower last winter for $470M. They’ve since embarked on a $28M reposition that’ll overhaul the interior and infrastructure, remodel the 25k SF public plaza out front, and add a cafeteria, conference facility and a new fitness center.
There will also be a luxurious private dining room on the top floor for the tenant’s bigwigs when the project wraps up soon. Asking rent runs from $40/SF to $70/SF, and possibly higher for the very top, which features double-height floors.
6. 95 Evergreen
95 Evergreen in Bushwick sits across the street from The Rabsky Group’s Rheingold Brewery rental development, at the edge of an emerging office district where the fringes of eastern Williamsburg meets western Bushwick. The site, which used to house a Schlitz bottling plant, was acquired by Hornig Capital Partners and Savanna last year for $33.7M.
It’ll be five stories tall with 160k SF of space in total with an updated façade, windows, a new roof deck and an overhaul of the mechanical systems. There will also be a retail component. And get this: the lobby will have a custom light fixture made out of 10,000 Schlitz bottles. The renovation’s cost has been pegged at around $30M.
7. The Brill Building
Brill Holdings, a partnership of Israeli fashion chain Fox-Wizel, B+B Holdings and landlords Conway Capital and Schottenstein Realty, bought the iconic building at 1619 Broadway last summer for $295M. They’ve since begun a $25M top-to-bottom reposition that will overhaul all of the 175k SF building’s interior and infrastructure, and add a glass façade for ground-floor retail. The project is slated to wrap up later this year.
Built in the '30s, the building became the beating heart of New York’s music scene during the '40s, '50s and '60s. Some of the most famous musicians and songwriters in American history worked and recorded there, like Elvis, Carole King, Paul Simon and Phil Spector, among many others.
8. 1407 Broadway
Shorenstein Properties is dropping $30M to give this 1.1M SF tower a makeover, with hopes of marketing it to the type of tech and other creative tenants that’ve flooded into Midtown recently. Shorenstein picked up the building for $330M in spring 2014, and the reposition will include improvements to the interior, façade and infrastructure, as well as new layouts for the office space and 33k SF of retail. The project is slated to wrap up later this year.