The Chetrit Group, a Manhattan-based real estate investor, has been approved for permits to demolish a stretch of four vacant buildings in the west side Hudson Yards area to create a development site.
The permits allow the company to clear the adjoining properties at 541-545 W. 37th St. and 540-544 W. 38th St., according to Kelly Magee, a spokeswoman for the New York City Department of Buildings. The site is between 10th and 11th avenues in one of Manhattan’s most in-demand neighborhoods for commercial real estate.
The Chetrit Group’s property is three blocks north of the new subway stop slated to open this year at 34th Street and 11 Avenue. The extension of the No. 7 line will improve access to the area, where development is pushing west from Midtown toward the Hudson River. The company, led by Joseph Chetrit, probably will put a hotel on the site, said Robert Knakal, chairman of brokerage Massey Knakal Realty Services.
“This market is on fire and any use will be well absorbed by the marketplace,” Knakal said in an e-mail.
The site is zoned for commercial uses and could accommodate a mix of office and residential space. Regulations allow for buildings totaling 172,800 square feet (16,000 square meters) on the property, with bonuses available through city programs that would more than double that figure to 373,248 square feet.
Chetrit purchased the buildings in 2012 for $26.5 million, according to Propertyshark.com. They are adjacent to two of the city’s four carriage-horse stables, which are drawing attention as potential development sites after Mayor Bill de Blasio pledged to ban the industry from Central Park.
“Demolition next to a horse stable is a tough thing,” said Cornelius Byrne, who has owned Central Park Carriages on West 37th Street since 1979. “I’ve been expecting it. We’ll have to see what happens.”
Central Park Carriages and West Side Livery, a stable located a block north on West 38th Street, could fetch $10 million each and would be especially attractive to Chetrit, who could fully leverage the buildable space on the sites, according to Knakal and Alan Miller, a broker at Eastern Consolidated.
Chetrit declined to comment on plans for the site through a spokeswoman, Kathleen Cudahy. The demolition permits were reported yesterday by The Real Deal.
Construction projects are picking up on the far west side after being stalled by the financial crisis. Related Cos. is building the first skyscraper at its Hudson Yards project, which the company says is the largest private development in U.S. history. Brookfield Office Properties Inc. (BPO) has plans for 4 million square feet of offices and a residential tower at its Manhattan West site.
A real estate company run by former New York Governor Eliot Spitzer in December bought a 17,281-square-foot lot on West 35th Street between 10th and 11th avenues for $88 million, a price that signaled growing developer interest in the neighborhood, according to Miller.
For all of Manhattan, prices for development sites jumped 22 percent to an average of $445 a square foot last year, data from Massey Knakal show.
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