Major Developments:
The City Council agreed to Mayor Adams’ signature housing policy after securing $5 billion in public funding and will now generate to 80,000 units over 15 years, the City of Yes for Housing Opportunity is now expected to add about 80,000 units beyond what would otherwise have been built. The zoning text amendment will go back to the City Planning Commission for review before it goes to a full City Council vote next month, but those are formalities in light of the agreement reached.City to supersize Midtown rezoning. Mayor Adams’ administration set its sights on Midtown South as the first area to permit larger residential buildings. The Department of City Planning announced modifications to its previously proposed plan for the area, taking advantage of a new state law allowing the city to exceed a longtime cap on the scale of new or renovated apartment buildings. The Department of City Planning has proposed to extend the density in most of the Midtown South area to 18 FAR, with the rest extended to 15 FAR. This would permit buildings to be up to 50% larger than under the cap, allowing for new construction and the reuse of industrial and office buildings. The earliest the rezoning plan could be approved by the City Council would be mid-2025.
The Council’s plan addresses two things that came up repeatedly during the City of Yes hearings: more affordability requirements and concerns about how local sewers will handle additional housing. The plan does not mention two other controversial elements of City of Yes: the elimination of parking mandates and the enabling of accessory dwelling units. The Council is going to fight for capital commitments and affordability requirements as part of City of Yes. City Planning announced that Midtown South will be the first area to benefit from the lifting of the city’s residential floor area ratio cap. Allowing FARs of 15 or 18 will, however, require approval of City of Yes.
The Chetrit Group landed a refinance for its planned two-tower, 1,300-unit apartment development in Two Bridges, ending a foreclosure from Madison Realty Capital. Chetrit chipped in more equity to extend its loan with Madison Realty for one year. The lender had initiated a U.C.C. foreclosure on Chetrit’s interest in the development site at 265-275 Cherry Street. Madison alleged that Chetrit defaulted on an $8 million mezzanine loan it used to finance the acquisition of the property.
Gary Barnett’s Extell Development filed plans for a residential tower to replace 655 Madison Avenue, proposing a 193,000-square-foot building that will include 62 residential units and commercial space. The existing 200,000-square-foot office building would be demolished. Extell purchased the property for nearly $160 million from Williams Equities. The price is about $800 per square foot. His new building’s zoning floor area is only 161,000 square feet.
The Real Estate Board of New York has been fighting the Fairness in Apartment Rental Expenses Act, or FARE, which would require whoever hires a broker to pay the broker’s commission. REBNY’s version of the bill does not change who pays a residential broker. Instead, it requires agents to provide prospective tenants with a “tenant bill of rights.” This document would spell out a tenant’s options and responsibilities if they sign a lease, stating that tenants do not have to work with a broker, identifying what fees a tenant is responsible for and underscoring that “compensation to a real estate broker is not fixed and negotiable between all parties to the leasing transaction.”
2 Wall Street owners filed plans for turning the eighth through the top floor of the 21-story tower, between Broadway and Nassau Street, into 121 apartments. The building owner is Fieldston Capital, which is with Aegis Asset Management.
NYC’s $819 million housing voucher program “plagued with problems,” state audit finds. The city's rental aid initiative for the homeless faces serious challenges, delays. One of the city’s largest rental aid initiatives, the City Fighting Homelessness and Eviction Prevention Supplement provides tenants with vouchers that subsidize 70% of their rent. The program is run by the Department of Social Services. The audit, conducted by the New York State Comptroller’s office, found that households waited an average of 10 months before becoming eligible for the program. Other issues include late payments to landlords, delays in documentation, and inaccurate classification of housing status. 117,000 were relying on the city’s shelter system, including nearly 60,000 asylum seekers.
Local Law 157 requires detectors near gas appliances in all multiple dwellings, one- and two-family homes occupied by someone other than the owner, and Class B dwellings, such as hotels by May 1, 2025. The Department of Buildings and the NYAA has identified only one, a DeNova Detect model, that meets that criterion and is also battery-powered.
Maddd Equities first considered an office building for their East Harlem development site, then a school but now apartments. Plans are filed to build 73 apartments and a commercial retail space. Also seeking to build medical space at 132 East 125th Street.
The loan tied to SL Green’s office tower at 1515 Broadway was extended 3 years after being moved to special servicing of the $742.8 million loan backing. The maturity date of the debt is now March 2028, while the interest rate is remaining at 3.93%.
The bagel store at 73 Greenwich Avenue filed a lawsuit against Lloyd Goldman’s BLDG Management to stop eviction proceedings. The landlord alleges Apollo is violating its lease because its bagel-hungry customers are blocking the entrances of neighboring stores.
RFR was granted a few months’ forbearance to refinance 285 Madison Avenue’s $219 million senior loan, until November to find new debt. Now the CMBS loan is back in special servicing for imminent maturity default. RFR’s problems at the office property, a York judge ordered the firm to pay its mezzanine lender on 285 Madison $18 million. The sponsor had defaulted on the building’s $205 million in subordinate debt in February.
Alexandria takes issue with plans for Kips Bay life science campus. The Firm warned diminished demand for life sciences space could dim plans for the project known as SPARC and requested the city to leave the door open for other uses at the Kips Bay project, including housing.
1 Park Avenue has recently lost its AAA rating. Despite being in good condition and having a high occupancy rate of 93.5%, the building was downgraded by S&P Global due to a lack of what they consider Class A amenities. The building's $525 million mortgage was downgraded to AA. This makes it the third Midtown office tower to lose its AAA rating.
230 Park Avenue value fell by 40%,over the past three years. The Helmsley Building, located at 230 Park Avenue, has seen a significant drop in its value, now estimated to be worth $770 million, down from $1.3 billion in 2021. RXR Realty's plans hopes to secure a new mortgage after the building defaulted on $795 million in debt late last year. RXR Realty is considering partially converting the building into apartments to reverse its sliding fortunes. The Helmsley Building is currently only 70% leased.
Electric vehicles need a charger and networking equipment, not just an outlet, to monitor usage and bill for it. Installation and permits might run up $7,000 or more per charger plus electrical building upgrades if needed Related Companies just used Gravity to install EV power stations at 401-471 West 42nd Street.
Bushburg filed to transform part of 80 Pine Street to 500 residences. Similar projects are in the works at 222 Broadway, 25 Water Street and 55 Broad Street.
