Major Developments:
The Department of Citywide Administrative Services is directing city agencies to identify underused office space that could be dropped in an effort to cut costs. The project was described to agency heads in the memos as a “mayoral priority”. The process is in the early stages.Proto filed a rezoning application to add to 2950 West 24th Street Proto already owns a 19-story, 360-unit building on the site, which it purchased in 2013 for $35.6 million. Proto is looking to add a 17-story, 415-unit building dubbed the Ocean Queen. Plans call for a 440,000-square-foot building with 15,000 square feet of community space and 10,000 square feet of retail. The community space would likely become a daycare, while a grocery store would likely take up a big chunk of the retail space. The project would also add a playground and 143-car parking lot.
Gov. Kathy Hochul turned her attention to state-owned sites to be converted into affordable housing. Mayor Eric Adams signed an executive order forming a task force to figure out what city-owned land can be turned into affordable housing. The task force, made up of various city agencies, will review all city-owned sites and determine whether affordable units can be built there. The city controls roughly 15,000 properties, of which more than 2,000 are vacant.
At least $700 million in debt backed by office assets owned by some of the city’s biggest names, RFR among them, was flagged by Morningstar for transfers to special servicing.
Savanna was working to push back maturity dates across its portfolio and divest from certain office assets as defaults mounted. 521 Fifth signed some tenants post-pandemic, but with the promise of lengthy rent concessions. Occupancy at 521 Fifth was just 74% and revenue was too low to cover monthly debt payments. Savanna is vying for one more extension. Its lender is also considering foreclosure on the $242 million loan.
RFR worked out loan extensions at 375 Park Avenue and 285 Madison Avenue At 17 State Street the building’s $180 million loan was transferred after RFR failed to refinance the debt at maturity. The property occupancy percentage is in the mid-90s. Cash flow as of the end of last year was 3.5 times greater than debt service. A new loan at a higher rate would reduce that ratio. RFR also has $40 million in mezzanine debt on the property.
16 Court Street or the Montague-Court Building the first quarter, cash flow was just covering interest payments on the $111 million loan and occupancy was 70%. The loan transferred to special servicing after upcoming lease expirations would likely impair CIM’s ability to pay its debt. The City University of New York rents nearly 15% of the building through a lease expiring August 30th. The debt comes due in three years.
Williams Equities filed plans to raze the 24-story office property at 655 Madison Avenue. Williams Equities co-owns the 200,000-square-foot property with Jamestown. The timeline of the building’s demolition is unclear and what will be put in the property’s place.
Witkoff Group and Blavatnik’s Access Industries secured the $1.15 billion loan for their One High Line development from JP Morgan and Tyko Capital.
Stahl’s refi closed at $750 million after Stahl contributed $250 million to boost the building’s value and keep it viable. And already having spent $120 million on improvements and signing six tenants to leases totaling 270,000 square feet in 2022.
Howard Hughes Holding Company purchased $40 million of air rights from the city for its long-awaited 250 Water Street project. The 27-story project at 250 Water Street is set to be a 27-story tower which will include 400 units.
The Tamares Group started shopping for debt to replace the $365 million loan coming due at 1500 Broadway. Tamares is shopping for new debt and discussing extension options with its special servicer.
RXR, SL Green eyes 5 Times Square as 1 million sf office-to-residential conversion. The building’s occupancy was 31% as of September 2022. The 1.1 million-square-foot, 39-story office tower, RXR purchased it with David Werner Real Estate in 2014 for $1.5 billion.
TPG and GFP’s Jeff Gural plan office-to-resi conversion in FiDi tower. Developers submitted plans for a 756,000 sf project at 222 Broadway or $150 million with GFP’s Jeff Gural. Now, GFP Real Estate and TPG Real Estate have submitted plans for a major office-to-residential conversion at the site. The project is set to turn the 31-story building with 756,138 square-feet into 798 apartments.
Elad Group to convert Nomad office to residential condos. Isaac Tshuva’s firm pays $72 million to buy 419 Park Avenue South. Elad Group plans to convert a Midtown South office building into condos. The company is planning around 100 units scheduled to be completed in 2026.
RFR owes a total of more than $27 million in principal plus interest and other fees for the properties. The RFR principals were sued over another mortgage by the joint venture, which was formed when two Blackstone affiliates, Rialto Capital Partners and the Canada Pension Plan Investment Board bought a 20 % stake in SIgnature’s debt as the Federal Deposit Insurance Corporation retained the rest.
RFR took out a $20 million mortgage from Signature against the commercial condos 122 Greenwich Avenue when it purchased the eight retail condo units in 2018 and stopped making the $98,000 monthly payments in April 2023.
At 219 East 67th Street , RFR borrowed $2 million against the retail condo in 2022 and stopped making payments less than a year later.
Vornado agrees to masterlease of 1 million sf at 770 Broadway. Deal comes after Meta shrunk its space in the office building.
Watermark Capital Group and Maguire Capital Group were sued by Rialto Capital Group for allegedly defaulting on a $45.3 million loan. Watermark’s had plans to construct a 28-story, 497-unit project at 6128 Eighth Avenue.
The City Council approved a rezoning in the Bronx that is expected to create as many as 7,000 apartments, 1,700 of them affordable, over the next 10 years. The rezoning targets 46 blocks around four new Metro-North stations planned for Co-op City, Hunts Point, Morris Park and Parkchester/Van Nest. The stations are expected to be completed by 2027.
1166 Sixth Avenue is about to lose D.E. Shaw, which leases 43% of the building. Arcesium, with 20% of the building, was also shopping for new space. The $85 million loan tied to 1166 Sixth transferred to special servicing for imminent monetary default, , EJM has until early 2027 before the loan matures. The property is also tied to $45 million in subordinate debt.
After a backlash from New York City hotels, the bill mandating they get licenses was blocked. The bill would have required law, hotel operators would need a license from the Department of Consumer and Worker Protection and for Hotels with more than 100 rooms would need to have 24-hour front desk coverage and security.
