By Linda O’Flanagan
Mayor Michael Bloomberg announced that upscale handbag maker Coach will be the first major commercial tenant to take space at the planned Hudson Yards development.
At a press conference yesterday (Tuesday) the mayor said Coach will anchor the first tower on the 26-acre site and will move into its 600,000 s/f of offices in 2015.
And he predicted the deal would start a chain reaction among employers looking for office space.
“Today’s news will have a domino effect on the rest of the development,” said Bloomberg. “Coach, a quintessential New York brand and major employer in the City, has been part of the City’s economy for 70 years, and now they are leading the way to a vibrant future for Hudson Yards.”
Construction on the 1.7 million square-foot tower is set to start in mid-2012 and be ready for occupancy in 2015.
Coach will purchase a 600,0000 s/f commercial condominium share in the tower – more than one-third of the available commercial space. Together with the completion of the #7 subway line extension and the new Hudson Boulevard Park, the deal will kick-start the development of the entire Hudson Yards area, a 60-block and 300-acre neighborhood. None of the parties involved in the deal would disclose further details of the sale.
The announcement was made at the site of future development near the corner of 11th Avenue and 30th Streets, where the Mayor and the development team were joined by Deputy Mayor Robert K. Steel, Speaker Christine C. Quinn, Tom Prendergast, president, MTA New York City Transit, Ann Weisbrod, president of the Hudson Yards Development Corporation and New York City Economic Development Corporation Seth W. Pinsky.
The first tower will rise 51 stories. Designed by Kohn Pedersen Fox Associates, the LEED Gold building will be prominently located on the corner of 30th Street and 10th Avenue.
Coach will occupy the lower one-third of the building, where they will create a vertical campus with an atrium serving as the visual anchor for the High Line.
The Coach tower is the south tower of a planned 5.5 million square foot “superblock building complex” bound by 10th Avenue, 33rd Street, Hudson Boulevard and 30th Street. When complete, it will be the largest commercial building in New York City.
“Coach, Inc. under Lew Frankfort’s direction has a well-deserved reputation as a forward thinking and innovative brand and today’s announcement to locate Coach’s world headquarters at Hudson Yards only further reinforces that standing and paves the way for construction to begin next year,” Stephen M. Ross, chairman and CEO of Related Companies said.
“The Hudson Yards represents the next chapter in New York’s history. The vibrant, modern, green, mixed-use environment with state-of-the-art technology that we will provide at Hudson Yards will help ensure New York City retains our competitive advantage for decades to come.”
The MTA Railyards in the Hudson Yards district is the single largest piece of undeveloped property in Manhattan and will be the biggest development that has been realized since Rockefeller Center.
Accommodating over 13 million square feet of commercial and residential space, development at the Railyards will transform the landscape of Manhattan and dramatically alter the City’s skyline.
Over 20,000 construction jobs will be generated by the construction of the Coach Building. Over 100,000 construction jobs will be generated by development of the Eastern Railyard (including over 80,000 direct jobs) and over 10,000 permanent new jobs will be generated upon completion of both yards, which will also serve as home to 30,000 office workers.
The master plan for the Railyards comprises approximately 5,000 residences in nine residential buildings, six million square feet of commercial office space, a one million square foot of retail complex, a 150-room five star hotel, a cultural facility, and a new 750-seat public school, all planned around 14 acres of public open space.
Key transportation investments are underway throughout the area around Hudson Yards including the extension of the No. 7 subway line, on schedule for a December 2013 opening.
Through the construction of a billion dollar platform over the yards, the site will be transformed into a mixed-use neighborhood with the Highline Park at its heart.
In 2005, the City rezoned the area around the High Line to encourage development while protecting the neighborhood character.
The combination of the rezoning and the park has helped to create one of the fastest growing neighborhoods in New York City.
Since 2006, after the rezoning was approved and construction of the High Line began, new building permits in the immediate vicinity of the High Line doubled and at least 29 major development projects have been initiated (19 completed, 10 underway).
CSX Transportation, Inc., the private rail freight company that owns the remaining unimproved portion of the High Line at the rail yards, has agreed in principle to donate this third and final section to the City. Ownership will be transferred once the City completes negotiations with underlying property owners.
The City, State and The Related Companies have agreed in principle to preserve the entire historic structure of the High Line at the West Side Rail Yards, including the spur over 10th Avenue, and to develop it into public open space.
In 2010, Oxford Properties Group, the real estate investment and development arm of the OMERS Worldwide group of companies, partnered with Related as general partners in the development.
Mary Ann Tighe and Greg Tosko, a vice chairman, of CBRE, represented Coach in the deal. Coach currently occupies approximately 225,000 s/f at 450 West 33rd Street on a lease that expires in 2015.
The company owns its current headquarters at 516 West 34th Street, plus a small building that adjoins it, for a total of approximately 475,000 s/f of office space in Manhattan.