Some real estate trivia for you: The office tower that BXP is building at 343 Madison Avenue is expected to provide ventilation to restaurants in Grand Central Madison, the Long Island Rail Road terminal far below it.
Not so trivial is that the terminal opened two years ago, but the tower needed to ventilate restaurant kitchens won’t be done until next year at the earliest. The ventilation issue is just one reason all of the terminal’s retail spaces remain empty.
“There are columns that encumber the spaces because they’re for the office spaces above that predate the terminal,” Metropolitan Transportation Authority real estate director David Florio told Newsday. “We’re pulling electric into the space. We are pulling the fire alarm system into the space. But the rest of the space has to be finished out by the tenant.”
The MTA spent four years trying to sign a master tenant to lease out the terminal’s 32 retail spaces, totaling 25,000 square feet, to individual businesses.
The agency has now abandoned that quest and is trying to lease the retail spaces itself, one by one, Newsday reported. The agency blamed its initial failed master-lease attempt on Covid. A second effort drew interest from two potential master tenants with experience in airport retail, but negotiations with them fell through.
“They basically said thank you, but no thanks,” Florio told the publication.
The MTA considers Grand Central Madison to be a success, as 28,500 riders pass through it daily, up from 7,000 when full LIRR service there began in 2023. The downside is it took forever to build and cost $11 billion.
That works out to $38,600 per daily passenger. No transportation agency in the world spends more for whatever it builds than the MTA.
But the underground Midtown terminal enhances the value of the real estate above, such as SL Green’s One Vanderbilt, which is worth $4.7 billion. At 343 Madison, BXP (formerly Boston Properties) is scheduled to finish its 46-story, all-electric tower next year, and Scott Rechler’s RXR and the Elghanayans’ TF Cornerstone are looking for a $4.8 billion construction loan from the Trump administration to build 175 Park Avenue.
So some of the $11 billion poured into the terminal comes back to the public fisc in the form of property and income taxes. And it saves a lot of Long Island commuters time as well as the drudgery of having to travel to Penn Station and then take two subways to get to Midtown East.
What we’re thinking about: Ridership to Grand Central Madison will be boosted by congestion pricing and office projects above. But it would also gain from more housing on Long Island, which has been even more elusive. Islip officials just said they want restaurants and businesses, but no homes, at a 48-acre Suffolk County site next to Ronkonkoma’s LIRR station. Does that make sense? Send your thoughts to eengquist@therealdeal.com.
A thing we’ve learned: To recommend removal of the mayor of New York City from office, the five-member Inability Committee needs at least four votes — but two committee members are the mayor’s people: his corporation counsel, Muriel Goode-Trufant, and a deputy mayor of his choosing. Goode-Trufant has been at the Law Department since 1991 and is not considered an Adams crony, but no one is predicting she would support removal should the committee be convened. The idea of the committee is to act when mayors are incapacitated by health or injury, but has been proposed as a way to oust Eric Adams.
Elsewhere…
In New York’s 13 most populous counties, small claims cases take an average of 5.5 months to resolve, but the wait is much longer in New York City, a New York Public Interest Research Group examination found. New York City’s understaffed, overloaded courts are causing the backlog, which affects tenants trying to get their security deposits back.
The average was 14 months in Queens, nine months in the Bronx, 8.5 months in Brooklyn and seven months in Manhattan. In Albany and on Long Island, resolutions took only three or four months.
Jared Della Valle’s Alloy Development has picked an address for the 63-story building in its massive, all-electric development between Flatbush Avenue and State Street: One Third Avenue. The trapezoidal-block project was called 80 Flatbush Avenue when its rezoning went through public review, but the company chose 505 State Street for the 44-story tower, which has opened, and 100 Flatbush Avenue for the commercial space in its base. A school in the development uses 362 Schermerhorn Street.
Closing time
Residential: The priciest residential sale Tuesday was $11.8 million for condo unit 17AW at The Cortland, 555 West 22nd Street in Chelsea. CORE Marketing Group’s Shaun Osher listed the new, 3,000-square-foot home.
Commercial: The most expensive commercial closing of the day was $24.8 million for 15 West 46th Street, a mixed-used, two-unit building totaling 25,900 square feet.
New to the Market: The highest price for a residential property hitting the market was $10.5 million for Unit 5 at 800 Park Avenue. Serhant has the listing. The 4,500-square-foot, Lenox Hill co-op apartment sold in 2022 for $12 million.
Breaking Ground: The largest new building application filed was for a 16,729-square-foot, four-story project with 32 dwelling units. Ariel Golshan of AG Engineering was the applicant.
— Joseph Jungermann
— Matthew Elo