Amid much back-slapping and cheerleading about the growth of Manhattan’s West Side at a panel yesterday that included developer Larry Silverstein, there was a hint that change could be afoot for the East Side of Midtown in the years to come.
The millions of square feet of new office development being planned and built on the West Side in projects such as SJP Properties’ 11 Times Square and Related Companies’ Hudson Yards could lead owners of older Midtown office buildings — many of which are on the East Side — to convert them into residential apartments, following a pattern seen Downtown.
“A lot of [Midtown East Side] buildings are old, and are approaching obsolescence, and they will be upgraded,” Stephen Siegel, chairman of global brokerage at commercial firm CB Richard Ellis, said, during the panel, which covered West Side development. “Downtown you had the same thing, and a lot of those buildings were taken down or converted to residential.”
But Siegel, one of eight speakers at the event sponsored by publisher Bisnow at 11 Times Square, said it was not a zero-sum game.
“This is not robbing Peter to pay Paul,” he said. “If you can’t believe that 40 million square feet [of new development] can be absorbed by growth and new tenants in the next five to 10 years, then you don’t believe in the city at all.”
Another speaker, Silverstein, president and CEO of Silverstein Properties, gave a brief history of his development of One River Place and Silver Towers, two large rental buildings on the Far West Side. He said he paid what seemed an exorbitant price of $20 million in 1984 for the entire city block between 41st and 42nd streets, and 11th and 12th avenues. At the time it was zoned single-story industrial.
“But I Had A Belief That A Square Block On 42nd Street had enormous value, if you could get it rezoned. And it cried out for a rezoning,” he said. Ultimately, he got the city’s approval, and built the projects in phases, with his 935-unit Silver Towers opening in 2009.
The other panelists included Scott Stringer, the Manhattan borough president, who gave opening remarks; Steven Pozycki, chairman and CEO of SJP Properties; Robert Futterman, chairman and CEO of Robert K. Futterman & Associates; Ron Sernau, partner at law firm Proskauer Rose; Laurie Golub, managing director of business affairs at Africa-Israel USA; and Jay Cross, president of Related Hudson Yards. The panel was moderated by Bruce Mosler, chairman of global brokerage for Cushman & Wakefield.