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Deals & Dealmakers

City approves $100M sale of St. John’s Terminal air rights in the West Village

The City Planning Commission has approved the sale of air rights from the Hudson River Park Trust to a group of developers planning a five-building, 1.7 million s/f project across from Pier 40 on the Hudson River.

The Trust, which manages the 550-acre park, will sell 200,000 s/f of air rights to Westbrook Partners and Atlas Capital Group for $100 million, paving the way for the planned project to be built. The Trust will use the money from the sale to repair the crumbling pilings at Pier 40.

In 2012, Westbrook Partners, Fortress Investment Group, and Atlas Capital Group purchased the 550 Washington Street, also known as St. John’s Terminal, for $541 million from longtime owner Eugene Grant.

Last year, Westbrook bought out Fortress Investment Group’s share in the building for $200 million.

The developers have planned to turn the site into a mixed-use project that would include retail and 450 units of affordable housing.

In one of the earliest plans Atlas Capital Group proposed the first phase of the project would include 450,000 s/f of condos and 100,000 s/f of retail, as well as dedicating at least 110,000 s/f of the project to affordable housing for seniors.

Earlier this month, in a letter to the City Planning Commission, the group changed some of the details of their proposal for the project. The changes included no longer pursuing a “big-box retail alternative” for the site, and a promise to include a minimum of four retail establishments at the ground-floor level on the north and west side of West Houston Street, and three retail stores on the ground floor on Clarkson Street.

The developers also nixed a plan to build a public park on a defunct elevated rail line, and added a plan for a 10,000 s/f indoor recreation center.

The sprawling building has long been viewed as a promising redevelopment project, due to its location on the West Side, the 800 feet of frontage is has along the Hudson River, and among the most spacious floor plates in Manhattan, which stretch up to 200,000 s/f.

The last hurdle for the project will be the approval the the City Council, which will vote soon on whether to okay the $100 million air rights sale to the developers.

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