5 Questions With David Neil of Durst Organization

And Durst has tried to capitalize on the change by investing $350 million over the past six years to its portfolio in the submarket, which Neil said has “really paid off.”

Before joining Durst, Neil was co-president and COO of New York Water Taxi and Circle Line Downtown as well as working as a representative in the U.S. for real estate company Evohaus, director of special projects at ShoreBank and CEO of publishing firm Little Green Dreams.

The following interview has been edited for length and clarity.

Commercial Observer: What makes the Bryant Park submarket different from other sections of Midtown?

David Neil: At most, the Class A office towers in the submarket have a vacancy of only 6 percent, which is among the lowest in New York City. The upper floor of the towers have an availability of only 2 percent. So low vacancy is certainly one of the defining features of this particular submarket. The diversity of tenants is also particularly interesting, from financial institutions to law firms and lots of tech and creative firms have also made the Bryant Park submarket their home.

The area has been seeing quite a renaissance in the last 10 to 15 years. Can you tell me about how Durst has managed to position itself to capture the interest in the submarket as it grew?

Over the last 10 to 15 years, there’s been an even greater emphasis on the experience that U.S. workers have in our buildings and in the surrounding community. Anticipating that shift, we reinvested even more into our assets to make them more appealing, and Bryant Park itself continues to thrive.

The nearby Grand Central district has seen an influx of development and tenants with the opening of Grand Central Madison station. Is that something that has spilled over into Bryant Park?

Certainly the access to the mass transit is incredibly important along with the outdoor space at Bryant Park, and the thriving activities that go along with it. We’ve seen, certainly in our portfolio, even over the last handful of years, more and more quality retail. For example, at the base of 1155 Avenue of the Americas, a number of great food and beverage restaurateurs have come to this particular community.

I believe the Grand Central submarket will likely follow a similar trajectory to Bryant Park, in part because of, as you’re pointing out, the investment that has been made with the improved access at Grand Central. Bryant Park is its own hub, if you will.

With such low availability rates, what does the development pipeline in the Bryant Park submarket look like?

There’s two ways to look at development. One is ground-up new construction, and the other is a building renovation. In my view, certainly both are in play, but the second is particularly in play. As we’ve seen in our portfolio, when we have made significant investments in our properties, the demand has followed 1133 [Avenue of the Americas] when we invested over $40 million to improve that building and brought it to contemporary standards with a beautiful new lobby, amongst other capital improvements

One Bryant Park would be the example of ground-up new construction, which was roughly 15 years ago. But to directly answer your question, I anticipate more building renovations in the years to come in submarkets like Bryant Park where there’s healthy demand.

What’s next for the Bryant Park submarket? Is it going to continue in an upward trajectory, or are there elements that may take it off course?

In my view, the Bryant Park submarket is not only in high demand right now, but I’m of the opinion that in this particular submarket, there will be even greater demand to be here in the coming years. You’ve already seen this play out over the last couple of years.

Mark Hallum can be reached at mhallum@commercialobserver.com.