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Thread: 225 West 57th Street - Extell - Hotel / Condo

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    Forum Veteran krulltime's Avatar
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    Default 225 West 57th Street - Extell - Hotel / Condo

    Extell buys 57th Street air rights for tower





    By Tom Acitelli
    February 8, 2006

    The Art Students League of New York has sold 135,000 square feet of air rights at 213 West 57th Street to Extell Development Corporation for an undisclosed sum. The sale transfers development rights to the old Hard Rock Café building adjoining the league's building to the west. Extell will use the air rights to develop a high-rise residential tower, according to a release from Colliers ABR, which brokered the sale for the league.


    Copyright © 2003-2005 The Real Deal.

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    Forum Veteran krulltime's Avatar
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    Anyone knows more about this new residential tower? Are they going to built on the old Hard Rock Cafe building? Buying the air rights, this one can be tall.

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    In the long run... londonlawyer's Avatar
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    There have been a few stories about this. The plan is to tear down the Hard Rock building and one behind it on 58th Street and build a new condo. I doubt that it would be more than 40 stories, but who knows?

    Nevertheless, the Hard Rock building is empty except for some Broadway dance company which Extell had tried to buy out and relocate them and when that failed, Extell tried to evict them.

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    Forum Veteran krulltime's Avatar
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    Thanks for the info Londonlawyer... anyway here is an article that will aswer my own question aswell...


    Quote Originally Posted by krulltime
    Anyone knows more about this new residential tower? Are they going to built on the old Hard Rock Cafe building? Buying the air rights, this one can be tall.

    Extell buys air-rights from Art Students League on West 57th Street


    09-FEB-06

    The Extell Development Group has acquired about 140,000-square feet of unused air rights from the Art Students League at 215 West 57th Street.

    Ira Goldberg, executive director of the league, told CityRealty.com today that the proceeds from the sale will be used to support its programs. He said he was “not at liberty” to say what the purchase price was of the air-rights.

    Criag Evans and Nicola Heryet, both senior managing directors of Colliers ABR, represented the league in the transaction. Mr. Evans told CityRealty.com today that “the negotiations required sensitivity to the unique light and air requirements of the Art Students League,” adding that “we were happy to negotiate a sale that addressed the concerns of the League while allowing Extell to move forward with the development in the area.”

    Extell controls the former Hard Rock building just to the west of the League and property extending through the block to 58th Street. The Hard Rock Café was founded in London in 1971 and was located in the base of the 12-story building at 225 West 57th Street where its entrance canopy was a late 1950’s black Cadillac converting with rotating wheels. Hard Rock recently relocated to the former Paramount Theater space at 1501 Broadway.

    The league’s building is an individually designated official city landmark rich in the city's cultural and artistic history.

    It was completed in 1892 and designed by Henry Jane Hardenbergh, who would become the architect a few years later of the nearby Plaza Hotel.

    In their great book, “New York 1900, Metropolitan Architecture and Urbanism 1890-1915” (Rizzoli International Publications, Inc., 1983), Robert A. M. Stern, Gregory Gilmartin and John Massengale provided the following commentary about the building:

    “The tendency in the Composite Era to monumentalize individual institutions extended even to the more modest fine art, historical and learned societies which had hitherto been content to carry on their proceedings in unassuming quarters that were frequently built for other purposes. In 1890, at the dawn of the Composite Era, the American Fine Arts Society held a competition for a new building…Atypically, the society was newly founded (1899) and building its first headquarters. Typically, however, its construction was made possible by a process of consolidation whereby a number of other organizations, including the Architectural League of New York (founded in 1881) and the Art Students League (founded 1875) agreed to share its galleries, studios and classrooms. During the Composite Era, the Fine Arts Society became the scene of virtually every important exhibition of art and architecture held in the city. The annual exhibitions of the Architectural League held there were major events for the profession and the public at large….The entries for the Fine Arts Society competition reflected the transitional state of American architecture in 1890. The winning scheme by Henry J. Hardenbergh, in association with John C. Jacobson and Walter C. Hunting, managed to bride the two eras. Completed in 1892, it was a stately French Renaissance palace with three central panels dedicated to art, architecture and sculpture. The glazed and densely ornamented panels contrasted with largely blank end bays visually buttressing the façade, while a red-tile gable roof above the projecting cornice paralleled the façade and furthered its aura of imposing domesticity.”

    The air-rights will likely enable Extell to erect a very tall, mid-block, condominium tower on the site of the former Hard Rock building.


    Copyright © 1994-2006 CITY REALTY.

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    In the long run... londonlawyer's Avatar
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    I wonder what they mean by "very tall". 40 stories?

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    According to the B'Way Dance Company's website, it is moving to another location and will leave Gershon's building on Dec. 17th. Therefore, demolition should start in a few months.

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    Default further air rights info

    According to a mailing I received this week from St. Thomas Church Fifth Avenue, Extell has also purchased the unused development rights from the St. Thomas Choir School on West 58th Street - at $185 per square foot, for a total of $2,217,040 plus conveyance taxes. The deal closed on November 16.

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    In the long run... londonlawyer's Avatar
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    I wonder how tall this will be since Gershon has purchased the air rights of many nearby buildings. I assume that he'll want it reasonably tall to ensure that as many units as possible have park views.

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    Viacom lease, HIP sale are Deals-of-the-Year
    A 500,000-square foot lease that kept the world's second largest entertainment conglomerate in New York and saved 2,500 jobs for the city, and the sale of a converted school that will probably return to a "former life" as an office building when its tenant's current lease expires, were recognized as 1994's top commercial brokerage transactions by the Real Estate Board of New York at its Annual Sales Brokers Party.

    Scott L. Gottlieb, Michael R. Laginestra and Martin Turchin of Edward S. Gordon Company won the Henry Hart Rice Achievement Award for the Most Ingenious Deal of the Year. They shared this prize for negotiating the Viacom International/Paramount Group lease at 1633 Broadway. These brokers had to conduct nine separate transactions, as well as arrange for a package of city benefits, to consummate the deal.

    The father-and-son team of Joseph A. Grotto and Joseph A. Grotto, Jr. of J. Grotto & Associates won the Robert T. Lawrence Memorial Award for the sale of an 80,000 square-foot building at 220 West 58th Street, now occupied by the Board of Education. To make the sale, these brokers had to find a tenant for the property and succeed in laying the groundwork to make future site development feasible.

    Viacom International assigned the prize-winning Edward S. Gordon brokers to help consolidate the conglomerate's operations and achieve major savings in business occupancy costs. The corporation's executives sought these economies because the heavy debt Viacom assumed in acquiring Paramount decreased the price of its stock just as the company was planning a subsequent merger with Blockbuster Entertainment.

    At this point, the restructured Viacom, its rank enlarged by the Paramount acquisition, occupied space in six Midtown locations. The company was inclined to place most of its operations in two of these buildings, and deploy as many as 2,500 workers to a nearly vacant 450,000 square-foot facility it owned in Englewood Cliffs, NJ. The site across the Hudson River offered economies that even the most favorably priced Manhattan location under consideration couldn't approach, but senior managers worried about coordinating corporate activities over the 20-mile distance between these two sites.

    A Viacom subsidiary, Showtime Networks, was located on several non-contiguous, asbestos-laden floors spread over two elevator banks at 1633 Broadway. This fast-growing cable television company's space was covered by four leases directly from the owner and two subleases from an accounting firm whose tenancy was scheduled to expire in 1998. Messrs. Gottlieb, Laginestra and Turchin decided that 1633 Broadway might be the solution to Viacom's consolidation problem if a sufficient number of contiguous floors could be assembled for the conglomerate's use.

    Achieving that goal involved a set of complex transactions that included negotiating a rent mutually acceptable to Viacom and the owner for vacant floors in the building, restructuring Showtime's leases, prevailing on the accounting firm to accelerate its transfer to new headquarters (which also involved obtaining the owner's consent), speeding up the schedule for the workletter and the asbestos abatement on floors to be occupied by Showtime and on the floors the cable company would vacate to accommodate a new tenant, and convincing the owner to grant Viacom expansion options even if the existing tenants wanted to renew.

    The Edward S. Gordon Company brokers also figured out a way to create additional space for Viacom in 1515 Broadway through relocation and sublet arrangements, and struck a deal for city benefits that eliminated the conglomerate's motivation to transfer 2,500 of its workers to Englewood. In sum, the many transactions successfully carried out by Gottlieb, Laginestra and Turchin kept a total of 4,500 jobs in Manhattan. The long-term $300 million lease for Viacom and the Paramount Group to occupy 500,000 square feet at 1633 Broadway was signed on December 20, 1994.

    Joseph Grotto and Joseph Grotto, Jr. had to negotiate one lease on-site and another off-site, as well as reach accords with owners of surrounding properties to make the sale of 220 West 58th Street possible. These brokers promised Devon Properties, interim owner of this building, that they would sell it. Health Insurance Plan of Greater New York (HIP) owned the building prior to selling it to Devon as part of its new lease agreement for space at 7 West 34th Street, another Devon holding.

    In 1989, the brokers secured an exclusive agency to represent HIP in its purchase or lease of new headquarters space with a planned simultaneous sale of the building it occupied at 220 West 58th street. These efforts culminated in 1991 when HIP signed a 20-year lease at 7 West 34th Street.

    The price for 220 West 58th Street's initial sale to Devon, as set by the brokers, was high at $18 million, which was broken down as $6 million of extra free rent at 7 West 34th Street and a $12 million purchase price for HIP's former headquarters. As its new headquarters were being prepared for occupancy, HIP had a one-year option to sell 220 West 58th Street to a party other than Devon for more than $12 million and pocket the difference, as well as the $6 million in free rent.

    During that year, the building for sale was shown 45 times. Of course, the market in 1991-92 was one of the worst in memory and the Midtown vacancy rate reached 18 percent. In a buyer's market, few wanted an older office property. A group of foreign investors, however, expressed an interest in purchasing, but only if a tenant could be found.

    In an exceptional burst of good fortune, Paul Davidson of Newmark Real Estate Services, representing the Board of Education, looked at the property and advised that the Board might be interested. The Grottos and Davidson arranged for a 15-year modified net lease with the Board of Education, which approved an expenditure of about $7 million to renovate the building and convert it to small high schools. Up to 500 students can use this facility, known as Landmark High School and the Coalition School for Change.

    Although the foreign investment group still found 220 West 58th Street appealing, its enthusiasm was tempered because a once-empty building, which had presented a leasing challenge, was now tied up for 15 years. The Grottos, based on a careful analysis of the zoning, emphasized the property's potential for the future. The closing took place on November 10, 1994, toward the end of the year in which the Federal Reserve raised the Short Term Federal Funds rate six times. This perilous climate for financing required the brokers to also keep moving along what became an all-cash purchase.

    The transaction kept 220 West 58th Street on the tax rolls, protected future development of a key Midtown site by placing the parcel in strong ownership, and enabled the city to accommodate two high schools at an attractive rent.

    Prior to this year's award ceremony, Turchin had won both the Most Ingenious Deal and Lawrence prizes. Grotto, Sr. had also won the Most Ingenious Deal award on a previous occasion. The Grottos are the first father-and-son team to be recognized with one of these prizes for brokerage achievement.

    The judges for this year's competition were Joseph Philip Forte, Esq., Partner and Chairman of the Real Estate Department of Thacher Proffitt & Wood; William Frentz, Vice President, Real Estate Investments, Guardian Life Insurance Company of America; Lloyd Goldman, President, BLDG Management Company; Peter Hausberg, President, Eastern Consolidated Properties and Chair of the Sales Brokers Committee; and James L. Houlihan, Partner, Houlihan-Parnes.

    The Henry Hart Rice Achievement Award was presented by REBNY Chairperson Bernard H. Mendik. The Robert T. Lawrence Memorial Award was given by Aaron Gural, Honorary Lifetime Chairperson of the Real Estate Board.

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    What does this old article have to do with this site?

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    I had inquired somewhere else if the dump occupied by Landmark HS was owned by the city or if it was owned by a third-party and leased to the Bd. of Ed. This article demonstrates the latter, and propertyshark.com indicates that Extell bought this site which is directly behind the Hard Rock. This stretch of 58th Street has been forlorn for some time, but it will be rejuvenated when Extell razes 225 West 58th and Clarett razes dilapidated properties on the other side of 58th.

    Furthermore, east of this site, on the block between 6th and 7th, Extell has begun razing the disgusting parking garage across the street from the NYAC's rear entrance. 58th street, therefore, is the beneficiary of new projects on CPS and on 57th Street.

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    Disgruntled Optimist lofter1's Avatar
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    Quote Originally Posted by londonlawyer View Post

    ... it will be rejuvenated when Extell razes 225 West 58th and Clarett razes dilapidated properties on the other side of 58th.
    You sometimes really crack me up ...

    Can I assume that you are referring to 220 CPS?

    This building is hardly "dilapidated" ...

    Undersized for the allowable zoning on its lot? Yes.

    Well maintained? A bit rough around the edges, but according to DOB it has minimal violations (one sign that things are in good working order).

    The prettiest girl in town? Nope, just an old fashioned white brick thang (but not nearly as bad as the few POS just to the west on W. 58th).

    btw: DOB also shows that the New Building Application filed by SLCE for this site (41 stories / 507' / 79 units) was DISAPPROVED on 2.01.07 (and that three other - but related - New Building Appications were DISAPPROVED around that same time)

    ***

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    ^That sounds like the site of a new Cesar Pelli residential tower.

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    Did they move all of the residents of 220 out already?

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    Quote Originally Posted by lofter1 View Post
    You sometimes really crack me up ...

    Can I assume that you are referring to 220 CPS?

    This building is hardly "dilapidated" ...

    Undersized for the allowable zoning on its lot? Yes.

    Well maintained? A bit rough around the edges, but according to DOB it has minimal violations (one sign that things are in good working order).

    The prettiest girl in town? Nope, just an old fashioned white brick thang (but not nearly as bad as the few POS just to the west on W. 58th).

    btw: DOB also shows that the New Building Application filed by SLCE for this site (41 stories / 507' / 79 units) was DISAPPROVED on 2.01.07 (and that three other - but related - New Building Appications were DISAPPROVED around that same time)

    ***

    I was referring to the buildings on 58th that Clarett owns.

    Nonetheless, for its location 220 is also garbage. If it was located on 1st or 2nd Aves., it would be acceptable since that area (my former neighborhood) is grungy. However, such a prime location on CPS merits an icon.

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