Midtown building to pivot with office condo conversion

32 West 39th Street ducked possible foreclosure last year

New York /
Feb.February 15, 2022 11:00 AM

R&B Realty Group’s Aron Rosenberg (R&B Realty Group, Rudder Property Group)

A Midtown office building is trying to leave its tough times in the past with an upcoming conversion project.

The office building at 32 West 39th Street is set to be converted to office condominiums for sale. Rudder Property Group announced it will be responsible for the sales and marketing of the 16-story property, which is owned by Aron Rosenberg’s 32 W 39th Street Sole Member LLC.

The area “has seen a lot of interest from major office tenants” following Amazon’s $1.15 billion purchase of the Lord & Taylor building from WeWork in March 2020, said Michael Rudder, principal of the eponymous company.

The 87,000-square-foot office building, constructed in 1925, sits one block south of Bryant Park. Potential buyers will have their pick of floor plans ranging from 3,970 to 8,371 square feet. Offices can also be combined to create a singular space as large as 70,000 square feet.

The property was recently renovated to restore the facade and upgrade both the lobby and the elevators.

Rosenberg has owned the building since 2004. Sales are expected to launch in the second quarter.

The conversion marks a new chapter for the Midtown building, which was saved from potential foreclosure early in 2021 when Ladder Capital provided Rosenberg’s R&B Realty Group, the landlord, slightly under $51 million to pay off loans at two separate office buildings.

The buildings were the subject of a lawsuit in February 2021, when the landlord filed to stop Maverick Real Estate Partners from foreclosing on them. R&B sought to refinance its debt with a new lender, claiming Maverick was “charging a default interest of 24 percent on each of the loans, and seems intent to…acquire the buildings on the cheap.”

Time will tell if the conversion to condos will make a difference in Manhattan’s embattled office market. The vacancy rate climbed to 17.3 percent in the fourth quarter, up by 21 percent year-over-year. But leasing activity soared 60 percent in the third quarter and ended the year at more than twice the pace of 2020’s fourth quarter.





    Related Articles

    arrow_forward_ios
    L-R: Savanna's Chris Schlank, Eastdil Secured's Will Silverman, JLL's Bob Knakal (Photos by Paul Dilakian)
    Office royalty talk conversions, distress and the “downsize upgrade” trend
    Office royalty talk conversions, distress and the “downsize upgrade” trend
    Columbia Property Trust's Nelson Mills and 799 Broadway (Columbia Property Trust, 799 Broadway, iStock)
    Columbia Property Trust signs investment firm to 71K sf at 799 Broadway
    Columbia Property Trust signs investment firm to 71K sf at 799 Broadway
    East End Capital's Jonathon Yormak and 141 East Houston Street (141 East Houston Street, East End Capital)
    Boutique LES office scores blockchain firm as anchor tenant
    Boutique LES office scores blockchain firm as anchor tenant
    Vice Media CEO Nancy Dubuc and 225 Broadway (Getty Images, Google Maps, iStock)
    Refinery29 subleasing at 225 Broadway for move in with Vice
    Refinery29 subleasing at 225 Broadway for move in with Vice
    Naftali Group's Miki Naftali, BRP Companies' Meredith Marshall (Photos by Paul Dilakian)
    Miki Naftali, Meredith Marshall talk development, death of 421a
    Miki Naftali, Meredith Marshall talk development, death of 421a
    R-L: Willow's Kevin Danehy, Era Ventures' Clelia Warburg Peters, Fifth Wall's Brad Greiwe and The Real Deal's Hiten Samtani (Photo by Paul Dilakian)
    Real estate tech is coming for your business
    Real estate tech is coming for your business
    Gary Barnett
    Gary Barnett has something to say
    Gary Barnett has something to say
    Industrious CEO Jamie Hodari and CBRE chief financial and investment officer Emma Giamartino (LinkedIn, CBRE)
    CBRE doubles down on flex-office provider Industrious
    CBRE doubles down on flex-office provider Industrious
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...