Majority of 17-story building to be transformed into apartments
A commercial office building near Grand Central Terminal in New York is set to undergo a major transformation, with most of the property being converted into residential units while a smaller portion will continue operating as office space. The project is supported by a $108 million construction loan.
The funding, arranged by Scale Lending — the lending division of Slate Property Group — will be used to convert 12 out of the building’s 17 floors into residential space. The 237,000-square-foot property located at 770 Second Avenue will feature 140 apartments, including 35 designated as affordable housing, according to CSC Real Estate. The firm focuses on complex residential and mixed-use redevelopment projects. The residential portion will also include approximately 11,000 square feet of amenity space for residents.
CSC Real Estate acquired the Midtown Manhattan property for $52 million from David Werner Real Estate. Werner is also involved in another large-scale office-to-residential conversion project nearby, at the former Pfizer headquarters across the street.
The redevelopment will benefit from New York State’s 467-m tax incentive program, which aims to promote the conversion of office buildings into residential housing.
While most of the building will transition to residential use, existing office tenants will remain in the lower four floors. These office levels are being repositioned as a separate standalone office asset. The property, also known as 300 East 42nd Street, currently houses tenants such as the Consulate General of Jamaica.
Industry experts note that this deal highlights strong investor and lender interest in well-located conversion projects across New York City. With increasing demand for quality rental housing, especially in areas like Murray Hill, the project is expected to attract strong interest once completed.
CSC is also working on similar office-to-residential conversion projects, including another development at 75 Maiden Lane in Lower Manhattan.
For the record:
Arrow Real Estate Advisors assisted in arranging the financing, with key representatives including Morris Betesh, Morris Dabbah, and Louis Halperin. CSC Real Estate received legal representation from Vedder Price, led by Robert Salame.
Source: Original reporting by Andria Cheng, CoStar News.
