Harry Macklowe is going to the bullpen at One Wall Street.
Macklowe Properties has tapped Lenny Inzrillio and Jacob Franco, formerly of Douglas Elliman, to direct sales at the large office-to-residential conversion in the Financial District.
Anna Zarro and Matthew Chook at Macklowe Properties will oversee “an in-house approach to sales,” a company representative told The Real Deal in a statement.
Inzirillio and Franco replace Kirk Rundhaug, Landis Hosterman and Katie Weisz of Compass (Weisz has since returned to Douglas Elliman in South Florida). Compass, which took over sales from CORE in 2021, did not return a request for comment.
For Macklowe, there remains plenty of opportunity at the Art Deco building, partly a result of the many offers that were turned down during Compass’ tenure at the project.
Since closing began last year, some 465 of its 565 units remain unsold, according to data firm Marketproof. Several industry observers have put the sluggish pace down to prices at the building, which they say more resemble a ground-up development than an office conversion with deep floorplates (which can make it challenging to create appealing residential layouts).
“As it turned out, it’s very challenging to convert an office building,” Macklowe told the British publication Spear’s earlier this year. Costs at the projects have exceeded $2 billion, putting into question how much financial room remains to just break even. By Macklowe taking over sales, the developer will save on payments owed to an outside brokerage.
Nonetheless, the building has received praise for its amenities, including a private restaurant, 75-foot pool and lounge and co-working spaces. Owners were assessed common charges for those amenities beginning in May, according to someone familiar with the project, a more generous grace period for early buyers that developers typically grant. Units have sold at an average discount of nearly 25 percent, just under $2,000 per square foot, according to Marketproof.
About half the units sold were to the buyers in the Asian investment market, which remains diminished in the wake of the pandemic and new capital controls implemented in China.
Adding to the sales challenge, the Financial District has more than 7 years of inventory compared to an average in Manhattan of 3.2, a sign of oversupply in the Downtown submarket. Among new entrants is 125 Greenwich Street with 272 units. The area remains a prime target for office-to-residential conversions as the values in the office market continue to settle.
Read more
Development
South Florida
Harry Macklowe wants to sell Miami development site near Dadeland Mall
Commercial
National
Harry Macklowe faces major losses on Miami, Midtown projects
Residential
Tri-State
Harry Macklowe’s Hamptons home not legally habitable
Macklowe has been active lately, although probably not in the way the 86-year-old developer would want, dealing with a cascade of financial dilemmas.
He has five months to refinance or sell the apartments he personally owns at 432 Park Avenue, and has put a Miami development site on the market while Fortress Investment Group pursues debt owed on that land as well as several properties in Midtown Manhattan.
The developer is also trying to sell a personal residence in East Hampton for $38 million, although it is not legally habitable due to extensive renovations and groundwork that were completed without a permit.