Why is the Pending One Chase Plaza Sale the Tipping Point in Downtown’s Residential Renaissance?

In a short update on the sale of One Chase Manhattan Plaza today, the New York Times encapsulates Lower Manhattan’s evolution to “Home Sweet Home” from Corporate America’s heartland.

To be sure, the Times notes, there is plenty of new business space available and coming with WTC development.

But when JP Morgan Chase offered the landmark 50-year-old building in August, the sales pitch was on redeveloping the tower as a condominium. Analysts said that the size and location in the heart of the financial district probably will mean a mixed combination of retail, office, and condos.

Today's Times story (see Charles V. Bagli, “Sale of a Landmark Building Reflects the Changing Needs of Lower Manhattan,” available here) suggests that the bidders indeed are looking to push the evolution button toward community rather than business.

The sale of the 60-story, 2.2 million square foot building, the article says, is “fraught with symbolism.” It adds, “Some urban planners, civic leaders and real estate executives say that turning this monument to financial capital into plush apartments or a chic hotel would indicate that the city’s second-largest business district, after Midtown, was losing cachet.”

The initial bids are in, the article says. The process is now entering a second round expected to end soon so that JP Morgan Chase can book the sale this year to offset multi-billion dollar settlement costs with the U.S. Justice Department over the banks role in procuring and then selling off questionable home mortgages.

CBRE is marketing the building for the namesake owners, and has been pushing the multipurpose development angle in its marketing materials, the Times reports. The dozen bidders--including marquee Manhattan development names and Asian investors looking to add a prestige property—are weighing the remodeling costs in a building requiring landmark approvals, the article notes. The bidders would pick up those development bills, which could push the deal above $1 billion.

JP Morgan Chase decided to auction the building after developer Steve Witkoff made an unsolicited $650 million offer, the Times reports, attributing the information to to several bidders. The bank would move the roughly 4,000 employees to midtown headquarters, as well other space it occupies further downtown at 4 New York Plaza.

comments powered by Disqus