New York’s next skyline-defining office tower is tapping the city’s other brand new skyscraper to help woo prospective tenants.
Scott Rechler’s RXR is running a leasing gallery for its planned 1,575-foot high Project Commodore supertall (aka 175 Park Avenue) from a spot one block over and 61 stories up in the air inside SL Green’s One Vanderbilt.
One Vandy has established itself as the darling of the city’s corporate tastemakers — the ne plus ultra of the “flight to quality” office. And Rechler’s project, which has a mirror location across the other side of Grand Central Terminal, no doubt wants to play off that cachet: One Vanderbilt is sold out, but you can get in now on its heir apparent.
“This is a great validation for the fact that companies want high-quality space,” Rechler told The Real Deal last year in reference to One Vanderbilt’s success. SL Green’s tower — now 99 percent full — set a new pricing record when it leased a space on the 73rd floor last year to a Canadian-based environmental services company for more than $300 per square foot.
RXR and its leasing team have been bringing prospective anchor tenants through the showroom, though the names of the companies are one of the office sector’s most tight-lipped secrets. The developer and its partner, the Elghanyan family’s TF Cornerstone, have shown space to tenants who represent about 15 million square feet of office demand, a source close to the marketing process said.
A JLL team led by Peter Riguardi is handling leasing for the 92-story project’s 2.5 million square feet of office. Riguardi has overseen the lease-up of new developments like Edward Minskoff’s 51 Astor Place and has the assignment for Boston Properties and Joe Moinian’s 3 Hudson Boulevard.
A few people who have visited the leasing center described it as an impressive showpiece with commanding views of Manhattan and overlooking the 175 Park site, as well as a large video screen depicting the tower’s future construction and integration to the transit station.
RXR had originally planned to get an anchor tenant and construction financing by the end of this year, though the team now acknowledges that may get pushed into 2024. The developers face some major challenges in a struggling office environment that’s further hampered by rising interest rates.
Manhattan leasing activity is down 33 percent so far this year compared to last year at 12.5 million square feet, according to CBRE. When renewals are taken out of the picture — so just looking at new leases — that figure is down roughly 46 percent.
RXR is co-developing 175 Park with the Elghanayan family’s TF Cornerstone. The two partnered to redevelop the site, currently home to the Grand Hyatt hotel, in 2019. The new building will include a 200-room Hyatt hotel and 10,000 square feet of retail.
The carbon-neutral building will have the tallest office floor and hotel room in the Western hemisphere.
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