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Published Apr 13, 2023
More than 1,300 apartments will fill an empty office building in Lower Manhattan, making it the biggest residential conversion project in the country, its owners say.
The building at 25 Water St. was once home to the Daily News and JPMorgan Chase, which cleared out earlier in the pandemic. New owners are using decades-old rules that ease residential conversions in the Financial District to gut the offices, carve out courtyards and add 10 floors to the 22-story structure.
The owners have not submitted the residential plan for final approval from the city’s Department of Buildings, but city signoff is a formality in Lower Manhattan office conversions as long as the new design meets zoning and construction rules. Mayor Eric Adams and Gov. Kathy Hochul both say these types of conversions can help supercharge housing supply in places like Midtown and Flushing, Queens but first need the state to tweak zoning rules. State lawmakers are considering those changes, along with a new office conversion tax break, in the state budget currently being negotiated.
Repurposing an office building is usually quicker than erecting a new structure from the ground up, said architect Eugene Flotteron, whose company CetraRuddy is designing the 25 Water St. floor plans. The developers say the apartments should open in about two years.
But changing cubicles and water coolers into bedrooms and kitchens isn’t as simple. Nor is it cheap.
Owners GFP Real Estate and Metro Loft plan to scoop out two courtyards from the center of the building and wrap apartments around them, said GFP head Brian Steinwurtzel. That’ll allow the building to meet light and air requirements. The owners also plan to raise the height to 32 stories while still complying with density restrictions, Steinwurtzel said.
The two firms bought the building, until recently known as 4 New York Plaza, in December for about $250 million and will spend hundreds of millions more on the conversion. Steinwurtzel declined to give a total cost estimate, but cited a $400 to $500-per-square-foot rate for most conversions. The building at 25 Water Street is more than 1.1 million square feet.
Steinwurtzel said the new building will attract a range of tenants motivated by a massive planned gym, ground-floor shops and two swimming pools.
“The expectation is that there certainly will be younger single folks who are just sort of starting out in New York, up to families with children that will be looking for these larger units,” Steinwurtzel said. “It’ll help to continue the transition of the financial district into a 24/7 mixed-use neighborhood.”
They plan to squeeze more than 50 market-rate and luxury apartments ranging from studios to four bedrooms onto each of the existing floors, fitting them together like Tetris pieces, according to initial blueprints. The owners and architects allowed Gothamist to view the floor plans but refused to release them for publication. The layout shows the complicated process of carving up commercial spaces set far from windows and turning them into places where people actually live.
Most of the apartments will have “home offices” that can double as bedrooms, but not all of those will have windows — a controversial arrangement backed by Adams. Other rooms described as offices will face the adjacent Vietnam Veterans Memorial Park, but the windows still won’t comply with current bedroom rules because they don’t face a street or courtyard.
For now, the imposing facade and narrow window slits give off prison vibes, but the building actually won an architectural award when it first opened in the 1960s. It was designed to look like a punch card and housed telecommunications offices and equipment.
One of the challenges in repurposing the building is ensuring that its windows comply with city rules.
The developers plan to expand the windows, tear down the brown brick facade and turn it gray, renderings show
On Tuesday morning, construction workers walked through the dust-filled lobby and loading bay, where asbestos removal notices hung from the walls and jagged scraps of metal stuck out of dumpsters. They were clearing out the offices in the floors above to make way for a complicated transformation project.
Flotteron said they will turn the loading docks and existing curb cuts into a parking garage and entryway,
Despite a deep affordable housing shortage taking the heaviest toll on the poorest New Yorkers, the project will not have any apartments with rents capped for low-income renters. That’s typical of office conversions in the Financial District, where there are no affordability requirements.
That makes it more profitable for building owners to take on expensive conversions. But it’s also fueling skepticism and opposition from affordable housing activists and local lawmakers contemplating new conversion rules for Midtown, Flushing and the Bronx’s Hub.
Members of the City Council grilled Adams administration officials on affordability requirements during a recent Council hearing on his office conversion plans, which would allow owners to turn offices into apartments in buildings constructed before 1991.
“We especially need to build affordable housing with convenient access to well-paying jobs, high-quality schools and other services,” said Land Use Committee Chair Rafael Salamanca at the hearing. “Manhattan neighborhoods should be accessible to more than just the wealthiest.”
But Steinwurtzel, the 25 Water St. developer, said state and city lawmakers will have to pay up if they actually want to turn office shells into homes.
