A conversion project is already on tap for the newly-rezoned Midtown South — it wasn’t one city leaders expected.
Earlier this week, developers Marty Burger and Andrew Heiberger announced the $25 million purchase of 29 West 35th Street and their plans to turn the aging office into more than 100 studio apartments.
News of the project, the first to take shape in the neighborhood, is coming less than two months after the City Council approved the measure, and it stands in stark contrast to the building’s fate just a year ago, when not one person bid on it when it went up for auction at just $270 a foot.
Though it’s kickstarting development in the area, the building actually wasn’t among the roughly 60 sites the Department of City Planning identified as ripe for conversion. The city actually listed a parking garage next to the building as one of the likely locations instead of the building itself.
The rezoning is expected to deliver 9,500 housing units, according to the city’s estimates — a conservative number that doesn’t encapsulate all of the sites within the area that developers could turn into apartments.
Heiberger said he and Burger had been keeping tabs on the rezoning leading up to the deal, though they signed the contract about four months before it crossed the finish line.
“There wasn’t really a lot of risk that this wasn’t going to be approved, especially on the heels of City of Yes,” Heiberger said. “It actually got approved three months earlier than we expected.”
When asked whether he and Burger were concerned about last-minute carveouts affecting the site, Heiberger said, “no, we weren’t worried at all.”
“It’s not a landmark, and it wasn’t in the area they wanted to keep as the Garment District,” he said. “We underwrote it based on potential to convert it without expecting air rights, so the air rights turned out to be a bonus.”
What we’re thinking about: The government officially shut down 10 days ago, and the country is starting to feel the impact. A shortage of air traffic control staffers has caused flight delays at several major airports, including Newark Liberty International Airport. The Trump Administration has also begun firing federal workers.
But as the shutdown continues, its effect on the industry remains unclear. Is the uncertainty holding up deals? Are buyers and sellers asking questions? Send thoughts to sheridan.wall@therealdeal.com.
A thing we’ve learned: A former outfielder for the Boston Red Sox, Mike Greenwell, died of cancer on Thursday at age 62. Just last year, Greenwell won re-election to his seat on the Lee County Board of Commissioners, to which he was appointed by Florida Gov. Ron DeSantis in 2022. During his tenure, the board rezoned 76 acres of his land for development despite pushback from local residents.
Elsewhere in New York…
— A four-alarm fire ripped through a commercial building on Long Island on Thursday night, drawing roughly 200 firefighters to the site in Hicksville, NBC New York reported. The fire likely began in a restaurant in the basement of the building, spreading from there and damaging neighboring businesses, including a donut shop.
— A potential nor’easter is heading toward the East Coast, and Tri-State towns along the coast are expected to begin feeling its impact on Sunday, CBS News reported. Those counties have issued coastal flood alerts spanning Sunday and Monday. New York Harbor will be under a gale watch on the same days, as winds could reach as high as 50 miles per hour.
Closing Time
Residential: The top residential deal recorded Friday was $5.7 million for a triplex townhome at 230 Bergen Street. The Boerum Hill residence is 4,400 square feet and last sold on the market in 2013 for $2.8 million. Compass’s Tamara + Noah Team has the listing.
Commercial: The top commercial deal recorded was $572.3 million for 1177 Avenue of the Americas. Silverstein Properties and the California State Teachers’ Retirement System sold the one-million-square-foot, 47-story building to joint venture Norges Bank Investment Management and Beacon Capital Partners, per reports.
New to the Market: The highest price for a residential property hitting the market was $45.5 million for 125 East 65th Street. The Lenox Hill mansion is 14,300 square feet. Serhant’s Melissa Post and Ryan Serhant have the listing.
Breaking Ground: The largest new building permit filed was for a proposed 33,564-square-foot, nine-story residential building at 3848 Bailey Avenue in the Bronx. Jakov Saric of Node Architecture, Engineering, Construction P.C. is the applicant of record.
— Joseph Jungermann
