Brookfield Properties is contemplating a sweeping makeover of 450 West 33rd Street, the large office tower it owns on the far West Side of Manhattan.
The revovation is being contempated as Brookfield, one of the city’s largest commercial landlords, plans to break ground on a $300 million platform over an adjacent site next month in order to prepare it for the development of what it is calling Manhattan West, a planned 5.4 million-square-foot office complex.
In a conversation with The Commercial Observer on Monday, Jerry Larkin, a senior leasing executive at Brookfield Properties and Bruce Mosler, an executive at Cushman & Wakefield who is handling the leasing assignment for Manhattan West, said 450 West 33rd Street would be renovated in order to connect it to Brookfield’s leasing strategy for the larger multi-billion dollar development next door.
Mr. Mosler said that Brookfield wants to give large tenants an option to lease space both in Manhattan West and 450 West 33rd Street in order to reduce their occupancy costs and incentivize deals in the new development.
“A tenant could take a 40,000-square-foot tower floor and then lease the rest of their space in 450 West 33rd Street and average down their costs,” Mr. Mosler said.
450 West 33rd Street’s rents, according to Mr. Larkin and Mr. Mosler would likely be much less expensive than office space in Manhattan West, which would need rents at least in the $70s per square foot to make its development costs financially feasible. Neither Mr. Larkin nor Mr. Mosler said they could calculate what kind of a discount bifurcating between the two locations could offer tenants than if they committed to Manhattan West alone.
“We would just be speculating because we have no idea how much space a tenant is going to want to take and how they’re going to want to split their operations,” Mr. Larkin said.
By integrating 450 West 33rd Street into its leasing plans for Manhattan West, Brookfield would appear to be seeking a leg up over competing office development projects, including the nearby West Side rail yards. The Related Companies meanwhile is seeking an advantage of its own with that development, trying to woo Time Inc., a tenant at Related’s Time Warner Center, into a deal to move to the rail yards. Sources say Related would offer to buy Time Inc.’s space at Time Warner Center, allowing the company to transfer the proceeds from that sale through a tax-free 1031 exchange into a similar commercial condo interest in a large office development over the rail yards.
Jerry Larkin said that Brookfield was still debating what kind of work it will do on 450 West 33rd Street, but the renovation could include installing an all new glass facade on the building, what would be a striking makeover of the 1.7 million-square-foot property.
“We don’t know what we’re going to do just yet but it could include a new facade, a new lobby and an upgrade of other building systems,” Mr. Larkin said.