With its only commercial tenant out, the legendary Flatiron Building at 175 Fifth Avenue is being converted into luxury housing.
The building has recently “fallen on hard times”, including seeing its only office tenant, Macmillan Publishers, move out before Covid, according to a report by The New York Times. This has prompted the building’s owners to redevelop the property.
A buyer had previously won an auction for the building back in March, but never showed up when it was time to cut the check. This past week, residential developer the Brodsky Organization bought a stake in the building and will lead the conversion according to the Times.
The triangle-shaped building will now feature condominiums or rentals. Dean Amro, a principal at the Brodsky Organization, says he believes the project shows the company’s “confidence in New York coming back even stronger than before.”
Sure, as long as you’re not talking about commercial real estate…
But we digress. The project is slated to take about 3 years, according to the Times. Approval from the Department of City Planning could take as much as a year, while demolition and construction would take up to two years.
Plans are still in flux, but roughly 40 residential units are under consideration, while the ground floor will remain retail. Real estate expert Jonathan J. Miller believes the shift aligns well with the stagnant office market and sees potential for the project to succeed as a residential landmark.
Since Macmillan’s departure in 2019, the Flatiron’s upper floors have remained vacant, and a court-ordered sale occurred earlier this year due to previous ownership disputes over renovation plans. The Flatiron district itself is among Manhattan’s priciest and most coveted residential areas.
Jeff Gural, an office developer who was the Flatiron’s majority interest holder, had hoped to maintain some of the office space in the building. But he eventually conceded that “current economic conditions” made it clear that the building would be “better suited for residences”.
Which is, of course, a nice way of saying, even commercial real estate developers don’t want to be in the business of commercial real estate right now…
He concluded: “There are going to be 40 people who want to live in the Flatiron Building.”