New York City developers didn’t face headwinds in 2023; they struggled through squalls. Interest rates climbed, construction costs spiked and the lending market seized.
Still, the firms that managed to rustle up funding found opportunity in declining land prices.
The projects that cracked this year’s ranking were overwhelmingly affordable housing, a clear sign that the shadow of 421a is still looming over new development.
Last year, every top project was a condominium, the asset class many multifamily developers turned to when the tax break expired in June 2022.
But as mortgage rates rose through 2023, the other end of the barbell — affordable projects with reliable rent rolls — became the next best choice.
The list also reveals a contender for this year’s comeback kid: hotels.
After a rough few pandemic years, tourists this year came flocking back to the Big Apple, and developers took notice.
To assess the largest projects proposed in 2023, The Real Deal analyzed permit applications for new buildings filed with the city’s Department of Buildings and ranked those projects by square footage.
Here are the top 10:
1) 30 and 35 Inspiration Lane, Brooklyn
The Gotham Organization’s East New York complex tops the list at 930,781 square feet. Project filings show 30 and 35 Inspiration Lane will be mixed-use buildings set to rise 15 and 14 stories, respectively, but the filings fail to specify whether the proposed 846 apartments will be rentals or condos. But smart money is on affordable housing. Gotham has decades of experience building affordable housing and recently partnered with the city’s Department of Housing Preservation and Development to construct Gotham Point, a two-building complex in Long Island City that is 75 percent affordable housing.
2) 39-02 Northern Boulevard, Long Island City
An outlier of the top 10, 39-02 Northern Boulevard in Long Island City is the only new project with office space. The space, though, is tucked in a five-story warehouse.
Logistics developer Goodman is capitalizing on the lasting demand for industrial space, with plans to add 883,470 square feet to New York’s footprint.
3) 895 Erskine Street and 888 Fountain Avenue, Brooklyn
Another one-two punch heading for East New York is L+M Development Partners’ 895 Erskine Street and 888 Fountain Avenue. Combined, the two 14-story buildings will add 563,312 square feet of affordable living — that’s 634 apartments — to the Brooklyn neighborhood.
And that’s not even the half of it. The project is part of a $1.2 billion state-backed “Alafia” development, which plans to create 2,400 new apartments over six construction phases.
4) 356 W 58th St, Manhattan
Mortgage rates be damned, CSC CoLiving is turning lodging into rentals.
In a departure from its bread and butter — developing affordable housing for younger renters — CSC filed plans for a major conversion of the Hudson New York Hotel, an early casualty of the pandemic.
CSC’s plans would see the Midtown property turned into a 454,756-square-foot, 438-unit rental building. The property first served as the American Women’s Association clubhouse when construction wrapped in 1929.
5) 1709 Surf Ave, Brooklyn
BFC Partners’ Coney Island dream is one of two seaside projects that made the top 10.
The 421,740 square foot project, set to face the Brooklyn Cyclones’ stadium, is yet another affordable housing play. BFC’s plans detail 430 apartments and 2,800 square feet of commercial space.
1709 Surf Ave will round out the final phase of a three-part city-sponsored affordable housing project. All told, the new developments will deliver more than 1,200 income-restricted units along Surf Avenue
6) 116 Beach 36 Street, Queens
Down the coast, the city’s Department of Housing Preservation and Development has a 10-story mixed-use project planned at 116 Beach 36 Street in Far Rockaway.
Again, project filings don’t specify what kind of residences the building will hold, but the city typically works on affordable housing. The 370,000 square foot development will be steps from the Rockaway boardwalk.
7) 871 7th Avenue, Manhattan
Gary Barnett makes two appearances on the top filings of 2023.
The first is for a project he still owns: Barnett’s Extell Development filed plans in April that would renovate the former Wellington Hotel near Billionaire’s Row. The century-plus-old property shuttered in December 2021. Extell’s plans figure to keep the existing structure as is, with 27 stories, ground-floor retail and a banquet room.
8) 440 West 57th Street, Manhattan
The Watson Hotel, a few avenues west of the Wellington, is also getting a makeover.
Isaac Hera’s Yellowstone Real Estate Investments bought the 600-room Midtown property out of default in early 2021. Two years later, the firm filed plans to convert some of the building into residential units. Yellowstone intends to transform the north tower into 249 units totaling 301,971 square feet. The south tower will continue to operate as a hotel.
9) 1710 Broadway, Manhattan
After failing to secure the city’s approval for a 54-story hotel conversion of the office building at 1710 Broadway, southeast corner of West 54th Street, Barnett’s Extell agreed to unload the Midtown office property this fall.
Riu Hotels and Resorts snapped up the site for $173 million and refiled Barnett’s plans for a 54-story hotel, 292,456-square-foot hotel in November. Riu got approved and the deal left Barnett in the red. Extell had paid $268 million for the site in 2017.
10) 1959 Jerome Avenue, Bronx
Peter Fine’s Atlantic Development Group just made the cut with an early-2023 filing for a 15-story multifamily building in the Bronx.
The Morris Heights project will replace a garage and auto body shop with 333 likely affordable units. The building, which will total 285,216 square feet, is set to include 29,000 square feet of commercial space and a 43,000-square-foot community center.