GFP, MetroLoft, Rockwood Reportedly Eyeing NYC's Biggest Office Conversion Yet At 25 Water
A joint venture of GFP Real Estate, Nathan Berman’s MetroLoft Management and Rockwood Capital is reportedly planning to team up on what could be the biggest office-to-residential conversion in New York City's history.
GFP, the investment firm owned by former Newmark Chairman Jeffrey Gural, and MetroLoft are looking at turning 25 Water St., which they put under contract earlier this year, into 1,200 rental apartments, The Real Deal reports, citing unnamed sources.
The development would be financed by a $250M acquisition loan from DekaBank and a $500M construction loan from Michael Dell’s family office, MSD Capital, per TRD.
Formerly known as 4 New York Plaza, the Financial District building has been used as back offices for JPMorgan Chase. Edge Cos. and HSBC Alternative Investments paid $270M to buy the property from Harbor Group International in 2012.
Conversions have been a much-discussed solution to the dueling headwinds plaguing New York City real estate: not enough housing and too many old, emptying office buildings.
GFP owns several Class-B properties around the city, and Gural told Bisnow last year it was too soon to consider conversions on a wide scale.
“I think it’s going to take a while to figure out are people coming back or aren’t they coming back,” Gural said in February 2021. "Our initial hope would be when people come back and things go back to normal, we will be able to rent it as office space.”
MetroLoft is New York's leader in conversions, having built 5M SF of residential out of former commercial buildings, according to its website. Elsewhere in the Financial District, it is working with Silverstein Properties to buy 55 Broad St., a largely vacant office building, and turn it into more than 500 apartments, TRD reported.
The idea of conversions has garnered national interest, but only about 50 office blocks have been converted or are in the process of being redeveloped into multifamily since the pandemic set in, per CBRE.