NYC Developer Seeking More Than $1 Billion for West Side Tower

(Bloomberg) -- The builder of Hudson Commons, an office tower on Manhattan’s west side, plans to sell the newly redeveloped property for more than $1 billion.

Located just east of the Hudson Yards complex, at 441 Ninth Ave., the 25-story building is anchored by Peloton Interactive Inc. and Lyft Inc. Its 700,000 square feet (65,000 square meters) are more than 75% leased, with the remaining space on the higher-rent, premium floors, according to marketing materials from CBRE Group Inc., the brokerage handling the sale for developer Cove Property Group.

The planned transaction is a bet that investors’ appetite for New York offices will pick up even as employees embrace hybrid work arrangements and companies re-evaluate their space needs amid the Covid-19 pandemic. 

“There’s more and more proof that people are not as efficient at home and even if you are, it becomes a drag to wake up, do all your work and go to bed in the same location,” said Darcy Stacom, head of New York City capital markets at CBRE. “The office is going to return in strength and we already have excellent activity. This will be an incredible core asset in a location with the world’s top financial investors.”

Commercial-property deals across the U.S. are on the rise after plummeting earlier in the pandemic. Transactions reached $131 billion in the second quarter, the third-highest volume on record for the period, data from CBRE show. In one of the largest deals this year, Oxford Properties Group and J.P. Morgan Global Alternatives sold an office building near the Massachusetts Institute of Technology campus for $825 million. 

Hudson Commons is one of four LEED Platinum-certified office towers in New York City and has more than 10 terraces offering views of the Hudson River, New York Harbor and Midtown, CBRE said. Blackstone Mortgage Trust Inc. provided $724 million in mortgage financing for the property in 2019. 

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