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Thursday, February 22, 2024

NYC’s Silverstein to Elevate $1.5 Billion for Workplace-to-Housing Push

(Bloomberg)—New York developer Silverstein Properties is in search of to boost $1.5 billion for changing older workplaces to residential buildings.

The owner, identified for creating towers on the World Commerce Heart, is in talks with traders to kick-start what could possibly be a “$10 billion-plus” alternative, Chief Govt Officer Marty Burger mentioned in an interview. The agency is exploring acquisitions of Manhattan workplace buildings which can be dealing with rising vacancies or debt burdens. The hassle may probably increase to different areas of the US, akin to Washington, D.C., Boston and the West Coast.

“It’s an enormous market,” Burger mentioned. “Our acquisition group is solely targeted on this proper now.”

Earlier this 12 months, Silverstein Properties agreed to purchase a Monetary District workplace constructing with associate Metro Loft Administration. They plan to start out remodeling the property, at 55 Broad St., into residential models in 2023, Burger mentioned. It is going to be Silverstein’s first joint-venture conversion challenge with Metro Loft.

Final 12 months, Silverstein bought 116 John St., a former workplace tower that Metro Loft had already transformed to housing.

New York landlords are exploring alternatives to transform out of date workplaces to residential use as vacancies and prices for modernizing the properties mount. With some tenants scaling again their house, and others flocking to newly constructed developments, many older towers sit largely empty. On the similar time, demand for residences in Manhattan pushed rents to information this 12 months.

“Now could be the right storm the place workplace isn’t in favor, and the residential market may be very scorching,” Burger mentioned. “Hopefully we are able to purchase a few of these workplace buildings that could be out of date or might not be their highest and greatest use as an workplace constructing, and convert them to residential use, which the town desperately wants.”

To contact the creator of this story: Natalie Wong in New York at [email protected]

© 2022 Bloomberg L.P.

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