RXR eyes 1 Chase Manhattan Plaza acquisition
Company would gut renovate office tower but skip a residential conversion
Scott Rechler’s RXR Realty is considering purchasing 1 Chase Manhattan Plaza, the 60-story office tower in the Financial District owned by JPMorgan Chase.
RXR would maintain the 2.2 million-square-foot building, which hit the market in August, as a commercial office tower, despite speculation that it’s a candidate for a residential or hotel conversion, Rechler told The Real Deal.
The real estate investor, who has been on an acquisition streak of late, appeared today as the keynote speaker at a global investment conference hosted by the Metropolitan New York Chapter of the Appraisal Institute.
He declined to comment on how much RXR would pay for the building or how far along discussions were, and said he was unaware of what other bidders were circling the tower, if any.
CBRE brokers Darcy Stacom and Bill Shanahan are marketing the property on behalf of JPMorgan. The building could trade for between $600 million and $1 billion, according to previous reports. Stacom and Shanahan were not immediately available to comment.
“Lower Manhattan is in an awkward stage,” Rechler said, referring to opportunities for investment in the Financial District. “That’s an area we’re focusing on because when you get through that awkward phase it’s going to Be An Incredible Place. If you have patience, it’s going to be incredibly successful.”
If RXR buys the building, the company would take advantage of 1 million square feet of upcoming vacancies at the tower to gut renovate it in a similar fashion to 75 Rockefeller Plaza, Rechler said. At “75 Rock,” RXR is hoping to increase office rents by $30 per square foot – to $100 a foot from around $70 – by attracting a new tenant roster lured by the upgrade, as previously reported.
Chase Manhattan Plaza was designed as an iconic commercial skyscraper by David Rockefeller in the 1960s, and the city would likely rather keep it as office space, Rechler said. Besides, he noted, a residential conversion would be problematic given the building’s landmark status, granted in 2009.
Still, Rechler said he wouldn’t expect to see success overnight in the neighborhood.
“It’s going to be challenging for a few years in Lower Manhattan,” he said. “I’m comfortable with that.”