The Daily Dirt: Facebook doubles down on Midtown

An analysis of New York's top real estate news

TRD New York /
Aug.August 03, 2020 07:00 PM

NYC’s office market just got a pretty big boost.

Back in May, Facebook announced that up to half of the company’s 45,000 employees would shift to remote work in the next few years. That didn’t stop the social media giant from moving forward with its massive lease at the redeveloped Farley Post Office, Rich Bockmann reports.

The company inked a 730,000-square-foot lease at the complex, part of which is being transformed into a new train hall for Amtrak and LIRR passengers. Landlord Vornado Realty Trust’s CEO Steve Roth on Monday said in a prepared statement that Facebook’s decision “reinforces New York’s position as the nation’s second tech hub.” We’re No. 2! We’re No. 2!

Not to be overly dramatic, but the deal shows a measure of confidence that the city will return to something resembling normal. Farley was envisioned as a bustling transit center with some 120,000 square feet of “curated” retail. FIlling that space will be tougher now, given the departure of Neiman Marcus from Hudson Yards and the uncertainty surrounding the other retail tenants at that mall, a few blocks west of Farley.

Facebook already has space at Vornado’s 770 Broadway. Last year, the company agreed to take more than 1.5 million square feet at Hudson Yards and has reportedly shown interest in Neiman Marcus’ space. Facebook has committed to the West Side, but it remains to be seen what the area will be like — what businesses will survive or repopulate offices after the pandemic — by the time the company fully moves in.

Outdoor dining will become a seasonal fixture in the city. That is little comfort to the businesses that likely won’t survive.

Mayor Bill de Blasio announced Monday that restaurants will be able to use curbside spaces again next June, starting a “a new New York City tradition” of outdoor dining during warmer months, Sasha Jones reports. The city is also considering whether year-round outdoor dining is feasible.

Of course, extending outdoor dining can only do so much for struggling eateries. According to surveys by the NYC Hospitality Alliance, the percentage of restaurants and bars who reported paying full rent dropped from 20 percent in June to 17 percent in July.

“You take these restaurants that signed very expensive leases and were barely doing well pre-Covid, and then you add this type of devastation, it shouldn’t surprise anybody that those places aren’t going to make it,” said Andrew Moger, CEO of BCD Development.

What we’re thinking about: Is on-demand, pay-as-you-go office space — which WeWork is trying out — the way of the future? Email [email protected].

CLOSING TIME

Residential: The priciest residential closing recorded Monday was for a condo unit at 400 West 61st Street on the Upper West Side at $3.2 million.

Commercial: The most expensive commercial closing of the day was for an industrial building at 375 East 163rd Street in Concourse Village at $5.4 million.

BREAKING GROUND

The largest new building filing of the day was for a 100,520-square-foot residential building at 406 Remsen Avenue in Flatbush. Amit Tank of Samnon Associates filed the permit application.

NEW TO THE MARKET

The priciest residential listing to hit the market was for a townhouse at 22 East 67th Street in Lenox Hill at $27.5 million. Modlin Group has the listing.
— Research by Orion Jones

A thing we’ve learned…

Boozy ice cream is now legal in New York. Gov. Andrew Cuomo signed a bill Monday authorizing the manufacture and sale of ice cream and other frozen desserts made with liquor. Thank you to Erik Engquist for passing along this very important development.

Elsewhere in New York

— A basket that MTA workers installed to catch debris from subway tracks fell and injured a pedestrian Sunday, Gothamist reports. Workers were installing the baskets at the Alabama Avenue J/Z station in East New York when the accident happened. “We believe there were several procedures and protocols that were in place that were not properly followed,” said Frank Jezycki, interim senior vice president at NYC Transit. “We’re still conducting our investigation, and we will take disciplinary action as we deem necessary.”

— A former prosecutor who resigned amid allegations that she withheld key evidence in a construction fraud case plans to run for Manhattan district attorney, the City reports. Diana Florence, who resigned as head of the Manhattan Construction Fraud Task Force in January, announced that she will run for the seat held by her former boss, District Attorney Cyrus Vance.

— Construction resumed Monday on St. Nicholas Greek Orthodox Church, which was destroyed during the 9/11 attacks, the New York Post reports. The church has sat half-finished for the past two years.


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