Another Office Tower to Rise on NYC's Far West Side
Related files for 25-story, 750K SF edifice on W. 36th Street.
The uncertain state of office occupancy levels in NYC, now hovering at around 46%, doesn’t appear to be dampening the enthusiasm of local developers who are rushing to building millions of square feet of new office towers on Manhattan’s West Side in Midtown.
From the sprawling Hudson Yards development over the MTA’s railroad tracks to a bevy of new towers planned to rise around Penn Station—and just about everywhere in between—new office tower projects are being announced In Manhattan at a frenetic pace.
Related Companies filed plans this week to build a 25-story, 750K SF office tower at 514 West 38th Street between 10th and 11th avenues on a site down the street from the Javits Center convention venue.
Related purchased the property from Eliot Spitzer, the former NY governor, in 2018 for $96M. The parcel previously had been part of a 1.4M SF mixed-use project Related was developing with Spitzer encompassing adjacent sites in Hudson Yards.
The proposed tower would be across the street from a 65-story, 2.8M SF building—to be known as Spiral—that Tishman will deliver this year at 66 Hudson Boulevard.
Last month, Related joined forces with Las Vegas-based Wynn Resorts to put forward a plan to build a casino on the undeveloped western half of Hudson Yards.
The plan calls for a new betting palace to be erected on a 10-acre platform that will be built over active rail lines, effectively connecting the 18M SF eastern half of Hudson Yards with the Hudson River waterfront. Related developed the eastern half, which opened in 2019, with Oxford Properties.
Related and Oxford recently cut the ribbon on 50 Hudson Yards, which is on its way to becoming the most expensive office project in NYC’s history.
Earlier this month, Related and Oxford announced they have secured a $348.8M construction loan for the 1,000-foot-tall office tower at 50 Hudson Yards. Wells Fargo is providing what’s being called a “rehab” construction loan, since this is the second loan covering the cost of building 50 Hudson Yards.
In 2017, a consortium of banks including Wells Fargo, Deutsche Bank, Banks of China, HSBC and Sumitomo Mitsui provided a $1.5B senior construction loan for 50 Hudson Yards.
Tenants at the 58-story tower will include BlackRock and Meta, which this month disclosed it is consolidating its office footprint in the city at two sites, 50 Hudson Yards and the Farley Post office. The social media giant formerly known as Facebook announced it is terminating a 200K SF lease at 225 Park Ave.
Truist Financial announced last month that it is leasing 100K SF at 50 Hudson Yards, relocating from 711 Fifth Ave, formerly known as the Coca-Cola building.
The estimated $4B cost of building the glass-sheathed tower translates into $1,407 per square foot, which puts the building within reach of the top of the list of the most expensive skyscrapers ever built in NYC.
Third quarter results for Manhattan’s office market showed signs of improvement as the availability rate dropped to 16.4% in Q3, its lowest level since March 2021, Colliers reported. Office leasing activity in Manhattan noted a 26% gain over Q2 2022, rising to 9.2M SF.