The start of major construction by Brookfield Office Properties on the deck over an Amtrak rail yard is a milestone — and not just for Manhattan West, Brookfield’s $4.5 billion development between Ninth and Dyer avenues.
The platform launch — first reported on nypost.com yesterday and to be formally announced today — is a crucial breakthrough for the entire Hudson Yards District.
It might be years before the area is built to anything like its full potential. But Mayor Bloomberg can take pride in having promoted and nurtured the creation of a new commercial zone west of Ninth Avenue that would have seemed a pipe dream a few years ago.
By the time he leaves office next year, each of the district’s major development sites — Manhattan West and Related Cos.’ much larger Hudson Yards — will have one major component in full-bore construction.
Brookfield’s 120,000 square-foot deck — an extraordinary investment for a project that doesn’t yet have any buildings — will span the train yard 65 feet below street level in an irregular rectangle bounded by Ninth and Dyer avenues and West 31st and 33rd streets.
It will create a new surface appealing to tenants and residents at what’s planned as a $4.5 billion complex anchored by three towers — two for offices and one for apartments — and an ambitious, 1.5-acre public plaza designed by High Line Park designer James Corner Field Operations.
Brookfield won’t build the office towers until it lands a tenant, a task for which it has tapped Cushman & Wakefield’s Bruce Mosler and Josh Kuriloff. But the deck is just as meaningful. It will finally eliminate a portion of the rail yard eyesore that both Brookfield and Related Cos., which control the Hudson Yards site to the west, have pledged for years to do.
Related’s strategy is the opposite of Brookfield’s. Where Brookfield is not waiting for a tenant to build a platform, Related is building its first tower before it starts work on a deck. Stephen M. Ross’s company has started on a 1.7 million square-foot tower that will be home to Coach and probably to L’Oréal as well, but hasn’t said when it will start the deck.
But in different ways, Hudson Yards and Manhattan West are now both seriously under way. The notion that the once forlorn far West 30s would one day be home to major companies, residents and a wealth of public amenities no longer seems far-fetched.
Brookfield first announced its plan for Manhattan West in 2006. It seemed to stall when the real-estate market plunged, and it took longer than expected to work out agreements with Amtrak and the Long Island Rail Road over use of the rail lines through the yard.
But Brookfield — cautious as a publicly traded company must be — stuck with the program. CEO Dennis Friedrich told us Brookfield will invest $300 million of its own capital in the deck along with a $340 million construction loan from HSBC, Bank of New York Mellon and four other banks.
He said the platform, which will take up 50 percent of the Manhattan West site, will be finished in late 2014.
Contrary to myth, neither Brookfield’s deck nor the ones Related will install between 10th and 12th avenues will support the buildings, which will have bedrock foundations and rise through gaps in the platforms.
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L&L Holding Co. has picked up another Fifth Avenue diamond in the rough: 114 Fifth, where it just bought a 99-year leasehold in a joint venture with private equity firm Lubert-Adler.
The 18-story, 1910 building at 17th Street has 341,000 square feet. L&L plans to upgrade and reposition it in a similar fashion to its redevelopments of 150 and 200 Fifth Ave.
The 114 Fifth transaction required creation of a new ground lease and modification of an existing loan. Terms were not disclosed. According to public records, the lease sale closed last week for $165 million.
L&L Chairman and CEO David W. Levinson said potential was strong for a “200 Fifth Avenue-style renovation” while bringing to market 330,000 square feet of prime office space.
L&L famously turned the former Toy Building at 200 Fifth into a showcase modern office address that’s now home to corporate offices for Grey Global and Tiffany & Co.
Changes to 114 Fifth will include new infrastructure systems, lobby and elevators, plus a landscaped roof to serve as a tenant amenity.
L&L’s Joshua Carson, Yong Cho and Kevin Fallon negotiated for the new owners.
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Newmark Grubb Knight Frank Capital group has completed the $80.55 million sale of a portfolio of five Citibank retail branches.
The seller, FGP West Street, tapped an NGKF team headed by Kenneth L. Zakin to market 18 Citi-leased properties in all. The others have already been sold or are in contract, but the five just sold were the most valuable.
The buyer was a joint venture of Madison Capital and an institutional owner the Newmark brokers declined to name, but which city records identified as an entity of Prudential Insurance Co.
Zakin called the five branches “the core” of the portfolio due to their prime locations, redevelopment potential and growing income streams. They include 181 Montague St. in Brooklyn Heights, a classic banking hall; 123 E 86th St; a retail condo at 2261 Madison Ave. at 91st Street; and branches in Queens and The Bronx.