The Daily Dirt: Domino Park office searches for anchor tenant

Two Trees revealed its ambitious office building at the old Domino Sugar Refinery factory, part of a mixed-used megaproject on the Williamsburg waterfront. 

When Two Trees purchased the site in 2012 for $185 million, it was set for a condo development. But the firm made the decision to transition a good chunk of the project to office. However risky that move seemed in 2012, it’s started to look much worse in recent years, especially now that the building has opened its doors without an anchor tenant.

The building does have a few things going for it, though.

As we covered last week, true Class A office — what some would call Trophy class — has fared much better than the rest of the market. The brand-new space fits the Class A mold better than most in the area. Asking rents reflect that, with a price per square foot from the high $70s to the high $90s, according to Commercial Observer. 

Also worth noting: it’s beautiful. The 460,000-square-foot glass tower is nestled inside the brick exoskeleton of the 150-year-old Domino Sugar factory, complete with a retro-looking sign and breathtaking views of Manhattan. New York Magazine’s architecture critic Justin Davidson called it, simply, “a great work of architecture.” 

How much that beautiful design is worth remains to be seen, especially given its location in Williamsburg. Office leasing in Brooklyn has been falling fast. 

For now, the building is poised to act as a barometer of the market for new office developments, especially those sitting outside the traditional powerhouses of Midtown and the Financial District.

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What we’re thinking about: It’s been a huge week for Related at Hudson Yards. Credit agencies boosted the rating for construction bonds tied to the project. Perhaps more importantly, the company sold a soon-to-be converted retail space to Wells Fargo for $550 million. The deal has raised eyebrows across the industry. It’s certainly a strong vote of confidence for Hudson Yards and the market for high-end office space. What are your impressions of the deal? Send a note to david.westenhaver@therealdeal.com.

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Closing Time

Residential: The priciest residential closing Friday was $10.5 million for a co-op at 1050 Fifth Avenue on the Upper East Side.

Commercial: The most expensive commercial closing of the day was $15 million for a rental building at 157-59 Wythe Avenue in Williamsburg.

New to the Market 

The priciest residence to hit the market Friday was a condo at 551 West 21st Street in West Chelsea asking $40 million. Douglas Elliman has the listing.

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A thing we’ve learned: This September has been the second-wettest in New York City history. For most of the month, the rain has been little more than a damper on the city’s spirits. Now, it’s causing major delays to transit service. Gov. Kathy Hochul and Mayor Adams both declared a state of emergency.

Elsewhere in New York

— A government shutdown could kick off this Sunday, as federal officials butt heads over a budget. A shutdown could impact millions of New Yorkers, Gothamist reports, from the 1.7 million people receiving food aid to the tens of thousands of government employees living and working in the city.
— A Manhattan judge ruled in favor of a city law requiring food delivery services to pay workers at least $17.96 an hour. The ruling is (obviously) a huge win for delivery workers, who earn $11 an hour on average, according to The City.