The Real Deal New York

Related’s $4B tower at 50 Hudson Yards will be NYC’s most expensive office project

2.8M sf building will cost about $1,407 psf

January 03, 2017 05:36PM
By Rich Bockmann

Rendering of 50 Hudson Yards (Credit: Related, Click to enlarge)

The Related Companies’ 50 Hudson Yards is expected to be the most expensive office building ever constructed in the city, with an all-in price tag of nearly $4 billion.

Related and its partner Oxford Properties Group peg the all-in development cost (including land acquisition, construction and soft-expenses) for the 2.8 million-square-foot tower at $3.94 billion, the partners disclosed in an application with the New York City Industrial Development Agency.

Related TRData LogoTINY is seeking permission to make fixed payments in lieu of property taxes that can fluctuate from year to year, and to forego paying the mortgage recording tax on the property – forms of assistance the IDA has offered since 2006 to encourage development in the Hudson Yards area. It’s not clear how much they would pay under such an arrangement.

A representative for Related declined to comment.

The nearly $4 billion price tag works out to about $1,407 per square foot for the Foster + Partners-designed tower (this figure is based on the 2.8 million square feet Related filed on forms with the IDA; the developer has said the project is 2.9 million square feet gross). The $1,407 per square foot cost is not far off from the $1,230 per square foot Tishman Speyer calculated it would cost to develop the $3.2 billion “Spiral,” which is being built across the street. As of now, One World Trade Center is the most expensive office building in the country with a cost of about $3.8 billion.

Related is still looking to lock down a $2.56 billion construction loan for 50 Hudson Yards, which the developer announced last month will be anchored by financial firm BlackRock.

The developer announced in December that the asset manager had signed a letter of intent to lease 850,000 square feet across 15 floors in the building, which is expected to open its doors in 2022.

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