Douglas Durst’s proposal to create new office and retail space at Hudson River Park’s Pier 40 development could be financially riskier than a community plan to build two residential towers, according to a new study seen by the Wall Street Journal.
The study – commissioned by the Hudson River Park Trust, a nonprofit that controls the park, and carried out by brokerage Newmark Grubb Knight Frank – found that the residential proposal would net the park between $70 and $80 per square foot for rental units and between $1,500 and $2,000 per square foot for condo sales. The proposal, created by a group of community advocates called the Pier 40 champions, will also include a dedicated recreational space.
In contrast, Durst’s proposal for new office and retail space would generate about 25 percent less than the developer had predicted for office space and half of what he’s predicted for retail, the study found. Durst has said he believes his proposal would generate $120 per square foot for the 100,000 square feet of retail space, but the study found that it would command between $60 and $80 per square foot. And for the 500,000-square-foot office space, which Durst predicted would net $55 per square foot in rent, the study concludes that rents would be below $45 per square foot, comparable to the rents at nearby Hudson Square.
In response, Durst told the Journal the study neglects to factor in the appeal of a commercial development surrounded by a park. He said that brokers had also doubted that his One Bryant Park development, located at Sixth Avenue and 42nd Street, would be able to command rents over $100 per square foot, though Durst eventually got almost $200 per square foot.
“I stand on my record,” Durst said. “I’m standing right on it right now.”
The residential development proposal has sparked criticism from State Senators Daniel Squadron and Brad Hoylman, who both voiced their reservations about developing housing on park land. [WSJ] –Hiten Samtani