Partnership closes on Donnell Library site, plans development

A rendering of the planned hotel, condo and library

By Roland Li

A partnership of Tribeca Associates and Starwood Capital has closed on the $67.4 million purchase of the former Donnell Library at 18-30 West 53rd Street, according to city records.

The closing is a substantial step forward in the redevelopment of the building, whose original plan was stymied by the downturn. According to the Tribeca Associates’ website, the partnership intends to build a new 120-room, five-star hotel on the site, which is across the street from the Museum of Modern Art. The building will also include 140,000 s/f of residential condos. Crain’s reported that the total project would be around 260,000 s/f and cost around $400 million.

According to PropertyShark, the current building is five stories and 100,441 s/f, while the maximum density allowed under zoning is 210,864 s/f.

Orient-Express Hotels had previously agreed to buy the site from the New York Public Library for $59 million in 2007, but backed out of the deal after the recession and sought to transfer ownership. Crucial to any new development was a guarantee of a new library to replace the deteriorating Donnell Library, which closed in 2008.

According to the Times, the developers will return a library space to the library by June 30, 2014. The library will be housed in the ground floor and basement of the new building.

“We’re pleased that Tribeca Associates and Starwood Capital Group Global are moving forward on the terms of the existing contract, including the construction timetable,” said a spokeswoman for the Public Library. “We will receive the full sale proceeds and are excited that we will have a wonderful new library in that location in the shortest time possible.”

Proceeds from the sale will fund renovations at other libraries, as well as facilities at the new library.

The original Donnell Library opened in 1955, named for Ezekial Donnell, a cotton merchant and library patron. It was perhaps best known for displaying the original Winnie the Pooh dolls, which have been moved to the library’s 42nd Street Stephen A. Schwarzman Building, named for the co-founder of the Blackstone Group, who donated $100 million the library.

Last summer, a temporarily art installation opened in the vacant space, and soon after, reports of a revived deal emerged.

For Starwood and Tribeca, the closing represents a triumph in one of the trickier – and lucrative – development blocks in the city. Across the street, the Museum of Modern Art and Hines sought to build a soaring, 1,250-tall tower, designed by Jean Nouvel. It was approved by the city only after a 200-foot decrease in height, and Hines recently filed a new plan.

In recent months, Barry Sternlicht’s Starwood Capital has been an aggressive buyer. At the beginning of the year, it purchased 1414 Sixth Avenue from Murray Hill Properties for $72 million, with plans to turn the mostly empty office building into a hotel.

Last week, Starwood Capital spent $159 million to buy a 33.3% stake in Brazil MRV Log, a company with 30 properties totaling over 1 million s/f in a country that has been touted as a major growth market.

Tribeca Associates is controlled by Bill Brodsky and Elliot Ingerman, both formerly of Insignia/ESG, a predecessor to CB Richard Ellis, and Mark Gordon, former head of Cushman & Wakefield’s hotel group.

The company previously built the 100-unit Smyth Hotel in Tribeca, which also has 15 condos and the French restaurant Plein Sud, and converted a rental building at 143 Reade Street to the Artisan Lofts condos. The firm’s other projects include the 425,000 s/f office conversion of 132 West 31st Street and a 500,000 s/f factory-to-office conversion in Cambridge, Mass.

Officials at Tribeca Associates didn’t return a request for a comment, while a spokesman for Starwood Capital had no comment.

Related Posts Plugin for WordPress, Blogger...

COPYRIGHT 2015 REAL ESTATE WEEKLY. ALL RIGHTS RESERVED.