Manhattan Sees Uptick in Planned Office-to-Residential Conversions

The ongoing critical issue of New York City’s lack of affordable housing has gained heightened attention among developers and New York State legislators. Headlines announcing potential plans for office-to-residential conversions have recently increased in number, and likely to be further fueled by the recently passed legislation as part of the state budget the provides tax break incentives to further encourage conversions. There have been reports of several other potential conversion projects in the neighborhood that are in different stages of planning — 222 Broadway, which was recently acquired for $147.5 million by GFP Real Estate and is seeking a $200 million construction loan; 25 Water Street acquired by Metro Loft Management and GFP Real Estate, the roughly $250.807 million deed in lieu of foreclosure transaction will give way to the development of more than 1,300 housing units; and more recently, Metro Loft will be joining investor David Werner in the planned conversion of the interconnected former Pfizer buildings at 219 and 235 East 42nd Street into a roughly 1,500-unit residential property. News reports further indicate Nathan Burman’s Metro Loft is also in talks “to join Intervest Capital on a conversion at 111 Wall Street. Further helping to fuel the momentum is the new legislation passed by New York State in support of Mayor Eric Adams’ estimate last year that office-to-residential conversions could create 20,000 housing units within 10 years. However, the “projection relied on changes by the city and state, including lifting the citywide cap on residential floor area ratio, or FAR, as well as a new tax incentive so more of these costly and complicated projects would pencil out.”

Source:    https://therealdeal.com/new-york/2024/03/14/metro-loft-plans-largest-office-to-resi-at-pfizer-hq/

Source:    https://therealdeal.com/new-york/2024/04/20/housing-deal-finally-passes-here-are-the-key-details/