Office buildings once stirred great controversy in Harlem. In 1969, Gov. Nelson Rockefeller’s proposal to build a state office building on 125th Street was greeted with deep opposition. Protesters occupied the building’s proposed site, renamed it “Reclamation Site #1” and distributed flyers saying the building “is like a dagger pointed at the heart of the community,” according to Monique Taylor’s 2002 book, “Harlem Between Heaven and Hell.”
Feelings about Harlem office buildings are much different these days. A major office and a hotel tower is proposed for 125th Street and another mixed-use project with office space is now opening. Older spaces, such as the Mink Building on Amsterdam Avenue and the Corn Exchange Bank Building, are being renovated and marketed as offices. Prices per square foot are often higher than downtown.
“There is a definite need and definite interest in more office space up here,” said Vincent Morgan, director of marking and information for the Upper Manhattan Empowerment Zone. “Unfortunately, on 125th (Street), there is not a huge amount of space to actually build it.”
Harlem’s commercial office market is small compared to the rest of Manhattan, particularly for Class A space. There is approximately 3.5 million square feet of commercial office space in Harlem, defined as Manhattan above 110th Street, according to Cushman & Wakefield. On 125th Street, one developer said there isn’t much Class A space at all.
Still, commercial office space is expanding in Harlem in the 125th Street corridor. There are plans for a $190-million, 29-story tower on 125th Street and Park Avenue, called Harlem Park, with a Marriott Courtyard Hotel and about 285,000 square feet of Class A office space. Down the street, at 125th and Lenox Avenue, the new Harlem Center includes 150,000 square feet of office space, with two state agencies already set as tenants.
Smaller spaces are also being converted to offices. Across from the hotel site, a collapsed shell that was once home to the Corn Exchange Bank is being converted into a mixed-use site for the Harlem Culinary Institute and 12,600 square feet of commercial office space. Cushman & Wakefield is the agent for the 19th century Mink Building, formerly a brewery and fur storage, which is leasing 88,000 square feet of loft-style office and retail space. A new condominium complex in West Harlem, Strivers Gardens, will add 37,000 square feet of office and retail space.
Despite the expansion, demand remains much higher than supply of Harlem office space, said Suzanne Sunshine, a director at Cushman & Wakefield with experience in the Harlem market. Sunshine said rents in Harlem offices are often in the high $20s to low $30s per square foot, while the City Hall area might have deals for closer to $10 per square foot. Stories are common of potential tenants who wanted Harlem space but moved downtown because it was cheaper.
Nonprofits are often attracted to Harlem to be close to their clients or to find space more suited to their needs. Government agencies have also traditionally filled office buildings in Harlem. Now, in a new step, the Harlem Park developer wants to get Fortune 1,000 companies to the neighborhood.
“Why hasn’t anyone looked at corporate America for Harlem?” asked Michael Caridi, managing director of the development group for Harlem Park, 1800 Park Avenue LLC. “It’s a critically untapped market for Harlem.”
Located adjacent to the Metro-North Railroad station and within a block of the Lexington Avenue subway, Caridi said he’s got an ideal location for commuters. Government subsidies are also helping to attract companies uptown. Harlem Park, for example, gets a 25-year property tax abatement along with a 45-percent reduction in utility costs. That translates into a $3,000 per employee per year savings for about a decade, Caridi said. “It’s an unbelievable package for a company to relocate here.”
There have been discussions with former President Clinton’s staff, among others, about moving to Harlem Park. “This building we are building would be a lot more presidential, in my opinion,” Caridi said. Clinton is now about two blocks away at 55 W. 125th Street. “They are considering it,” Caridi said of Clinton’s staff. “Nothing is etched in stone.”
Still, office development in Harlem faces hurdles, including overcoming concerns about safety from potential tenants. “When I talk to a company that is thinking about moving uptown, that is the first thing I hear,” said Sunshine. Offices are usually located on 125th Street, she said, because potential tenants see it as the most secure location. Attitudes are changing, but Sunshine said assuaging companies’ safety concerns about Harlem will be a challenge.
Expansion space is also limited on 125th Street. Harlem Park was fortunate, Caridi said, that there was an open space close to transportation. Morgan, of the empowerment zone, said Harlem still needs a critical mass of office space so developers don’t shy away from 125th Street. Continued demand will help encourage them.
There also must be community support for new offices.
“We are still in the early stages of development in this community,” Morgan said. “There are certain factors that we have to consider, that is – the community, and what they want. We don’t want to build things just to build them.”