RXR Pursues Micro Conversion at 61 Broadway

RXR appears to be bringing its appetite for Manhattan office-to-residential conversions to the Financial District.

Scott Rechler’s firm filed plans this week to convert part of 61 Broadway into housing, the New York Business Journal reported. The plans were submitted to the Department of Buildings on Monday.

The plans filed by RXR so far indicate the firm plans to redevelop only a single floor of the 670,000-square-foot office property. The ninth floor will spread 21 apartments across 20,000 square feet of residential space, along with a bike room and a lounge. CetraRuddy Architecture will design the space.

The developer did not return the publication’s request for comment.

RXR ran into trouble at 61 Broadway a couple of years ago. In December 2022, RXR went into default on the property when it stopped making payments on the loan, which it took out in 2019. The loan had a two-year initial term and three one-year extensions, reaching maturity default in May 2023.

Months later, JLL listed for sale a $240 million nonperforming loan on the troubled Financial District office building. RXR had agreed to hand the keys back through a deed in lieu of foreclosure if necessary, but never did so.

At that time, the office space was only 57 percent occupied. In 2019, flexible workspace provider Knotel leased 60,000 square feet across four floors, but filed for bankruptcy two years later.

The mini-project is a sharp contrast to another RXR conversion that could prove to be one of the biggest in New York City.

RXR, Marc Holliday’s SL Green and Marc Rowan’s Apollo Global Management are planning to convert the 38-story office building at 5 Times Square into up to 1,250 units of housing, mostly studios, of which 25 percent would be affordable.

The project is expected to get 467m, a property tax break earmarked for office-to-residential conversions where at least 25 percent of units are designated affordable; it would be eligible for a 90 percent exemption for 35 years if construction begins before June 2026.

This summer, Corebridge Institutional Investments provided a $561 million loan for the development.

— Holden Walter-Warner