Closing time: HFZ vacates the XI sales gallery in Chelsea

Elaborate gallery at 25 Little West 12th Street has been packed up, demolished

New York /
May.May 14, 2021 05:35 PM
(Vimeo/DBOX)

(Vimeo/DBOX)

Little West 12th Street is down another tenant. Embattled developer HFZ Capital Group has moved out of its gallery space in West Chelsea.

Though the signage touting the developer’s luxury condominium, the XI, still hangs off the storefront, the interior has been emptied of all its furnishings and artwork, The Real Deal observed on a recent visit.

The gallery space had been elaborately renovated by HFZ to hold three art installations with its raison d’être being to sell $2 billion worth of luxury condominiums at HFZ’s nearby project, The XI. The unfinished building, designed by architect Bjarke Ingles, contains 236 units spread between two twisting towers.

HFZ won an award from magazine Interior Design for the finished space. One of the installations, dubbed “Egg,” was a 30-foot long model of Manhattan that was attached to a mirrored ceiling in the gallery.

It was designed by artist Es Devlin, who is known for creating large, site-specific sculptures and installations for designers, performances and major events such as the closing ceremony of the London 2012 Olympic Games. Devlin has designed sets for celebrities including Adele, Kanye West, Jay-Z and Miley Cyrus.

Architectural model builder Kennedy Fabrications partnered with Devlin to create “Egg.” In mid-March, the builder told its Instagram followers that the sculpture was being dismantled. On Thursday, Kennedy posted a timelapse video showing the sculpture being taken apart one piece at a time.

“Just strolled by yesterday trying to get another peak at it! Too late tho,” one follower commented. “Too late indeed,” another replied.

The gallery owner, Greenway Mews Realty, is preparing the space for a new tenant, according to a contractor who spoke on the condition of anonymity.

“They’re going to demo everything and they’re going to rent the space out,” said a contractor, who recently did work on the property. The person confirmed that all the art was gone, apart from the fountain, which is now empty.

The relationship between the tenant and landlord wasn’t always smooth.

Last August, Greenway sued HFZ claiming the developer did not vacate the space when its three-year lease expired in June. The dispute was settled later that month when HFZ extended its lease through March 2021. The monthly rent had been $152,235, according to court documents.

What the empty space means for HFZ, which did not respond to requests for comment, or its sales efforts at the XI going forward is unclear.

Sales have been slow at the project for years, but the project’s future is uncertain amid HFZ’s mounting financial and legal troubles.

In January, the Zeckendorf brothers were considering taking over the project. Then HFZ’s lender at the XI alleged that the developer failed to pay interest required on loans of $655 million and $100 million between April and November last year, triggering a default. The Children’s Investment Fund, a hedge fund, provided HFZ with a $1.25 billion loan on the project in 2017.

To date, less than 20 percent of the condos at the XI have been sold, according to property records. A recent analysis of contracts at the project by data firm Marketproof shows 39 units valued at $286 million have found buyers.

One of the buyers reportedly includes New Zealand’s wealthiest man, billionaire Graeme Hart. He signed a contract for a $34 million penthouse in 2019.

Douglas Elliman Development Marketing, which also declined to comment, is still handling sales for the project.

It’s the second time in recent months that HFZ has vacated a property it has intricately designed. Last month, Ashkenazy Acquisition took over the developer’s swanky 13,000-square-foot office at 600 Madison Avenue.




     
     

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