Wells Fargo is spending more than a half-billion dollars to buy a Hudson Yards property for a retail-to-office conversion.
The bank is paying roughly $550 million to buy Neiman Marcus’ former space at 20 Hudson Yards, Bloomberg reported. Related Companies and Oxford Properties Group are selling the three-story, 400,000-square-foot space while retaining ownership of the rest of the 11-story property.
Wells Fargo plans to occupy the space, which spans floors five through seven. The deal for the space hasn’t closed yet, but is expected to be one of the year’s largest commercial property deals in Manhattan once it does. Newmark’s Doug Harmon and Adam Spies brokered the deal.
The space has been sitting vacant since 2020, when Neiman declared bankruptcy. Related pivoted and marketed the department store space to office tenants after the retailer left, despite spending $80 million building out the store for the retailer. Nobody bit for three years.
Newer developments still have pull for office tenants, though, even as the broader office leasing situation remains dicey. Wells Fargo knows Hudson Yards well, owning a majority stake in the observation deck and 500,000 square feet of office condos at 30 Hudson Yards, which houses the bank’s securities, investment banking and capital markets business.
Sources told The Real Deal that the bank plans to hang on to its other Hudson Yards offices when the deal at 20 Hudson Yards closes.
One of the hot topics in Manhattan real estate is the conversion of properties from office use to residential use. While this isn’t a reversal of that specific push, a conversion to an office property isn’t too common as companies adapt hybrid and remote work policies.
The seven-floor property at 20 Hudson Yards was a pivotal part of Related’s plan to diversify Hudson Yards beyond office and residential uses, hoping to spring luxury retail tenants and hotels. There are approximately 100 shops and restaurants stretching across the 1-million-square-foot building, including retailers such as Cartier, Louis Vuitton and Dior.
— Holden Walter-Warner
Update: This story was updated with more information regarding Wells Fargo’s plans at Hudson Yards.
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