The bustling stretch of Third Avenue in Manhattan is witnessing a remarkable transformation, emerging as an unexpected hotspot for real estate investment and innovation. In July, Cyrus and Darius Sakhai's Sovereign Partners acquired the building at 767 Third Avenue for $177 million, equivalent to $350 per square foot. Plans for conversion are underway, with Rudin eyeing potential changes for the property. Meanwhile, David Werner is considering a similar transformation for No. 675, recently purchased from Durst.
Durst is also making significant investments in the area, infusing $150 million into buildings No. 733 and 655. These edifices now boast green roofs and exclusive tenant terraces, showcasing a commitment to sustainability and modern amenities. The spaces within these 50-story towers range from 1,973 square feet to around 11,000 square feet, catering to diverse tenant needs.
SL Green Realty Corp is another major player in the Third Avenue revitalization. Their property at No. 909 encompasses 1.34 million square feet with floorplates of about 34,000 square feet, while an anticipated $805 million will be spent on No. 885. Meanwhile, the Lipstick Building at No. 685 offers a sprawling 1.5 million square feet of space.
Sage Realty is set to renovate No. 825 with Dynamic View windows and new building infrastructure. This comprehensive renovation includes a new lobby and a hospitality-focused amenity featuring a wraparound outdoor terrace on the 12th floor.
Quantum, teaming up with Metro Loft Management, plans to convert No. 850, further adding to the array of projects redefining Third Avenue's skyline. Durst has renovated Nos. 750, 777, and 780, enhancing their appeal in this burgeoning locale.
The owners of 830 Third Avenue have taken a bold step by pulling 130,000 square feet off the market to create 188 residential apartments, reflecting the growing trend of mixed-use developments in the area. Several towers on Third Avenue now offer prebuilt offices ready to rent as small as 2,000 square feet, accommodating the changing demands of urban professionals.
Nuveen has invested $40 million to renovate and rebrand the Skidmore, Owings & Merrill-designed No. 777, further testament to the corridor's dynamic evolution.
"All of a sudden there’s a new focus on Third Avenue, not only by the owners, but by the tenancy," – Dan Shannon
The renewed interest in Third Avenue is driven by several factors. The allure of Park and Madison Avenues with their premium rents and limited availability on higher floors has shifted attention to more accessible spaces.
"The fact is, all the buildings on Park and Madison that are often more desirable are not only seeing rents that are higher, but availabilities are mostly only on the lower floors," – Adam Henick
As investors pour resources into these properties, the market is responding positively.
"The market is realizing the benefits of all the monies invested in the asset and the unique nature of its column-free floorplates," – Paul Amrich
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