The Real Deal New York

Chetrit to pay $29M to double size of Hudson Yards site

Developer is looking to sell block-through property
By Rich Bockmann | February 18, 2015 08:30AM

The Chetrit Group is on the prowl for a buyer for its Hudson Yards development site, but in the meantime, the firm is planning on spending $29 million to more than double the buildable square footage the property allows as-of-right.

Joseph and Meyer Chetrit’s development firm is looking to tap into a pair of building bonuses available in the Hudson Yards neighborhood that will add roughly 200,000 buildable square feet to the block-through development site between 37th and 38th Streets east of 11th Avenue, according to an application filed with the Department of City Planning. The site (known as both 541-545 West 37th Street and 540-548 West 38th Street) currently allows for about 173,000 square feet as-of-right.

The bonuses come with certain restrictions on how the additional FAR can be distributed, and Chetrit reckons the total 373,068 square feet could be split between two buildings: a 28-story, 131-unit residential building facing 37th Street and a 43-story, 315-key hotel fronting 38th Street.

The Chetrit Group was looking for a buyer for the property when a state appellate court ruled last month against former owner Baruch Singer, who claimed his creditors should have paid more than $2.5 million to acquire the site through foreclosure in 2011.

Neither Chetrit nor Cushman and Wakefield’s Bob Knakal, who has the listing, could be reached for comment.

Chetrit paid $26.5 million in 2012 to buy the site from Baruch’s mortgagor, Fortress Investment Group. While the Cushman listing does not have an asking price, industry experts estimated it could fetch between $75 million and $80 million.

The application pegs the total cost of the building bonuses at $29 million. Roughly 70 percent of the 200,453 square feet will cost Chetrit $125.36 per square foot, a figure tied to the Consumer Price Index.

The approximately 62,000 square feet that remain will cost $188.50 per square foot, a price determined based on an appraisal of the receiving site. That figure compares to roughly $225 per square foot for bonuses that will go to The Moinian Group’s 3 Hudson Boulevard office tower a few blocks south on 34th Street.

Chetrit is also converting the Sony Building at 550 Madison Avenue into luxury condominiums, and as TRD reported yesterday, is looking to score a record $150 million for the project’s triplex penthouse.