The developers behind the $1.5 billion Essex Crossing megaproject are about to begin the development’s second phase, which will bring 350,000 square feet of office space to the Lower East Side. And that could spur more office development in a neighborhood typically associated with a trendy residential market, nightclubs, art galleries and restaurants, the Wall Street Journal reported.
“An area like this is not an office area, but if this becomes successful, then others will create opportunities there to develop office space,” Newmark Knight Frank’s David Falk told the Wall Street Journal.
Many liken the Lower East Side to the Meatpacking District, where boutique office developments command some of the highest office rents in the city.
The Essex Crossing site’s proximity to neighborhoods like the East Village, Chinatown, Soho and the Bowery, Little Italy and Nolita is one of the attributes that attracted the developers to the project.
“It was like the hole in a doughnut,” said Charles Bendit of Taconic Investment Partners, which is developing Essex Crossing with BFC Partners and L+M Development Partners. “You had great dough all around it and this hole that needed to be filled.”
The developers plan to close on the $460 million construction financing for the two towers that will hold the office space by the end of the year. Construction is expected to kick off next year and be completed by 2020.
Asking rents are projected to be in the high-$80s per square foot to the mid-$90s per square foot, Bendit said.[WSJ] – Rich Bockmann