Despite the upgrades taking place, Turchin asserts, office rents remain at levels indicative of the area's current offerings, providing some surprising price breaks. “The average asking rent in Times Square South is more economical than every single submarket in Midtown South,” he declares.

“Usually within a market you have some pockets but Midtown South has become very horizontal in pricing so Times Square South has become a great spillover area,” Turchin adds. “People are seeing that—as well as an influx of tenants—and putting in capital.”

He elaborates, “So its not inferior to Midtown South but it's less expensive. The average asking rent is $58.06, whereas the least expensive rent in Midtown South is $63 per square foot and the average is $70.”

Retail is on the rise too, asserts Smith. “It feels like the area's office and retail are evolving at the same time. What was the garment district is evolving to become home to TAMI tenants so we've configured spaces that are commensurate with the demand from those occupiers.”

He continues, “Today's tenants want apparel, fast casual food, convenience—such health and beauty business or drugstores. This is especially the case for TAMI tenant who may be working odd hours or on the weekend, because the base tenants in the area aren't residential so those services aren't widely available.”

The changes at 1407 Broadway, as well as those that already have been made or are in the works at the Grace Building, 7 Bryant Park and in the park itself, which is now home to yoga classes and the like, will give the area a new complexion.

“Times Square South is evolving into a vibrant retail corridor versus primarily a service area,” declares Smith.

Agrees Turchin, “All of the retail around the area is changing rapidly, so we will see several redevelopments and we will get some great users. It will be a much different area in the next few years.”

NEW YORK CITY—A single restoration and rebranding of an office and retail tower happening in the area some brokers have dubbed Times Square South—spanning from Sixth Avenue to Eighth Ave, and from 42nd to 34th streets —promises to breathe new life into the neighborhood. More broadly, combining this shift and some changes already underway in Midtown could transform the submarket.

Shorenstein Properties is doing a major renovation at 1407 Broadway following its acquisition of the building last Spring. The upgrades focus on both the expansive office and retail space, in keeping with the “tremendous amount of capital” being poured into area buildings, Peter Turchin, vice chairman, CBRE, who's handling the agency for the office portion of the building, tells GlobeSt.com in this EXCLUSIVE story.

“The renovation of 1407 Broadway is completely transforming the appearance and appeal of one of the largest buildings in the Times Square South district,” he declares. “On Broadway between 34th and 42nd streets, you'll see a bunch of buildings either that have been or will be redone, and not just lobby, also retail and facade. It's because you've seen a big influx of tenants in the area.”

Adds Patrick Smith, vice chairman, JLL, who is marketing the retail space, “This corridor, which was the Garment district, has a streetscape not representative of the tenants in the building or those who want to be there. We have the ability to reposition an entire blockfront, with about eight spaces we can bring to the market at once. The building has a setback from the street so if you merchandise the ground floor with tenants that are more indicative of what office tenants want, you really can make an impact.”

Despite the upgrades taking place, Turchin asserts, office rents remain at levels indicative of the area's current offerings, providing some surprising price breaks. “The average asking rent in Times Square South is more economical than every single submarket in Midtown South,” he declares.

“Usually within a market you have some pockets but Midtown South has become very horizontal in pricing so Times Square South has become a great spillover area,” Turchin adds. “People are seeing that—as well as an influx of tenants—and putting in capital.”

He elaborates, “So its not inferior to Midtown South but it's less expensive. The average asking rent is $58.06, whereas the least expensive rent in Midtown South is $63 per square foot and the average is $70.”

Retail is on the rise too, asserts Smith. “It feels like the area's office and retail are evolving at the same time. What was the garment district is evolving to become home to TAMI tenants so we've configured spaces that are commensurate with the demand from those occupiers.”

He continues, “Today's tenants want apparel, fast casual food, convenience—such health and beauty business or drugstores. This is especially the case for TAMI tenant who may be working odd hours or on the weekend, because the base tenants in the area aren't residential so those services aren't widely available.”

The changes at 1407 Broadway, as well as those that already have been made or are in the works at the Grace Building, 7 Bryant Park and in the park itself, which is now home to yoga classes and the like, will give the area a new complexion.

“Times Square South is evolving into a vibrant retail corridor versus primarily a service area,” declares Smith.

Agrees Turchin, “All of the retail around the area is changing rapidly, so we will see several redevelopments and we will get some great users. It will be a much different area in the next few years.”