Brookfield begins $4.5B Manhattan West project
By Orlando Lee Rodriguez
As midtown marches west, a key engine piston driving change, began constructing the first vital link between New York’s future transportation hub and the neighborhood that will become Hudson Yards.
Representatives from Brookfield Office Properties Inc. (NYSE:BPO), the City of New York and the Port Authority of New York and New Jersey gathered at the now barren site on West 33rd Street and 9th Avenue, which will become Manhattan West.
“Today we are launching a project which is as important to the city of New York as the covering over of Park Avenue in the 1920’s,” said John E. Zuccotti, Co-Chairman of Brookfield Office Properties. “[That] was in fact the start and the stimulus for years of development.”
The $4.5 billion development when completed will feature two towers of class-A office space along with a third residential tower measuring two-million-square-feet. Each building will contain retail and there will be 1.5 acres of open space for the public, promised jokingly not to be named ‘Zuccotti Park North’.
The $680 million platform portion of the project is being financed through a five-year, multi-bank construction loan worth $340 million. HSBC, The Bank of New York Mellon, Wells Fargo and U.S. Bank along with Canadian based Toronto-Dominion and The Bank of Nova Scotia provided the construction capital.Brookfield will kick in the other $340 million platform construction. No public subsidies were used. Skidmore, Owings and Merrill is the master plan architect. The residential tower will be designed in collaboration with SLCE. Cushman & Wakefield is the development’s leasing agent.
The construction commencement of the a platform over the Amtrak and NJ Transit tracks below represents a long time visionary victory for executives at Brookfield. The company’s predecessor Olympia and York purchased the site in 1984, when present-day, overall CEO Rick Clarke worked in the leasing department as a young analyst measuring the sites profitability in a then recovering New York.
“Hopefully the numbers work a little better than they did in 1985,” said Dennis Fredrich, CEO of Brookfield’s office property division. “A number of investments, over 6 billion dollars have been made since 2005. Manhattan West will serve as a much needed expansion of the Midtown business district, assuring that the tenant base will be able to secure a highly efficient, state of the art, environmentally friendly office space to grow their businesses.”
“This project is strategically located to create a very critical link between the transportation hubs to the east of us and the rest of the Hudson Yards district. It also creates an important link to the energy that Chelsea represents in terms of residential, retail and cultural excitement,” Mr. Fredrich said.
Shares of Brookfield Properties rose 0.08 points or 0.48% to $16.85 per share after the announcement on Tuesday.
Mayor Michael Bloomberg, now in his final year of office, has been a champion of west side development and rezoning since taking office in 2002. He commented on the role that cooperation between government officials, community boards and regular citizens played in making far west side development a reality.
“People want this city to survive, they want it to grow and get better and for us to have jobs,” he said. “Democracy ain’t perfect, it doesn’t work smoothly or quickly all the time but it does work. I could not be more optimistic about the future of the City of New York.”
The area surrounding the 50 million square feet project was rezoned in 2005. Across 9th Avenue the Moynihan Railroad Station, a replacement for the disastrously demolished original Penn Station, is expected to be completed its first phase in 2015. Manhattan West’s platform is projected to reach completion a year before, allowing the first office tower to begin leasing in 2016. Negotiations, Brookfield said are now underway with a few potential tenants.
“We are beginning to see our vision come to life in a big way. It is just amazing how much development there has been all along the west side, an area that everybody thought did not have the potential to become a hot neighborhood with the fancy restaurant’s that everybody wants to go to,” Mayor Bloomberg said.
One key feature touted by both city officials and developers is the 100 foot wide pedestrian mall along West 32nd Street in the center of the development. This thoroughfare will connect Moynihan Station with the High Line and Hudson Yards. Brookfield also owns the building that shores up the rear of the project, 450 West 33rdStreet, leaving open the future to possible expansion on the developments west side.
The ceremony took on a combination triumphant and ‘last-hurrah’ tone by host John Zuccotti. The former deputy mayor during the Beame administration, when New York had arguably hit rock bottom, implied that he was wistful on Mayor Bloomberg’s time in office reaching its end, making a point to predict the Mayors place in the city’s history books.
“From the very first year he was mayor he focused on the question of West Side development,” said Mr. Zuccotti. “He understood that the important thing was to establish the link between Battery Park City and Riverside Park, he recognized the need to adjust for the 21st century. In 10 to 15 years I invite you all to come back here and see, Michael Bloomberg will be remembered as the man who rebuilt New York City.”
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