Benigno Serrano bought 12,350 square feet adjacent to Chelsea’s High Line for just $900,000 in 1986.
Last year, he turned down $10 million for it. This year, a developer named Alf Naman finally got it for $12.5 million, according to city transfer records.
And that’s just the beginning. Welcome to the great High Line development cash-in! While the elevated railway itself is still just a rusty, weed-covered insurance liability, speculators and developers are already squeezing money from it. The towers of West Chelsea are on their way!
The developer who lost out on Mr. Serrano’s property is David Kislin. He’s building a 12-story condo tower called High Line 519 on an adjacent property that he purchased two years ago. High Line 519? “We had wanted to create a name with some association with the neighborhood, but something more than just the address. We considered something tied to history, but it didn’t really fit,” Mr. Kislin said. “New Yorkers are not that big on history. I am a huge history buff, but this name is looking forward.”
The architect on the building is up-and-comer Lindy Roy, who devised a sleek, glassy façade with geometric screens that function as railings for the French doors that open—watch it now—directly onto 23rd Street. Prices range from $860,000 to $3.4 million. Five of the 11 units are already sold.
For that price, you get large windows on the front and back. But the cut-outs that promotional materials show in the kitchens, living rooms and bathrooms—the ones that would actually look onto the High Line itself—will, it seems, be blocked by another tower.
Mr. Serrano sold that property, the one wedged between High Line 519 and the actual High Line, to his $12.5 million bidder, Alf Naman. And Mr. Naman is planning to build his own 12-story residential tower on the narrow sliver of land there.
Mr. Serrano’s not exactly grateful for his own windfall. “I wish anybody who got involved in it took a long walk on a short pier,” he said. “People can’t afford a studio around here, because it’s too much fucking money.”
While Mr. Naman concedes that the coming High Line will increase property values nearby, he argues that his land would have been worth even more had the elevated railroad been knocked down and a full-scale tower built there instead. “Developers and owners gave up a lot by agreeing to sign on to the High Line,” he said.
But the prize for the most dramatic change of heart goes to a parking-lot and storage-facility operator in the area, Jerry Gottesman, who formed the Chelsea Property Owners about 15 years ago to force the High Line’s owner, CSX Transportation, to tear down the structure. (The rail line, which runs from Gansevoort Street to West 34th Street, mostly between 10th and 11th avenues, hadn’t been in use since 1980.)
Back then, the Giuliani administration sided with these folks and asked the federal government to condemn it. It took artful negotiations by the Bloomberg administration—and much fund-raising and civic canoodling by a park-obsessed group of do-gooders—to reverse that course and persuade opponents to give up their fight.
Under the rezoning passed by the City Council in June, Mr. Gottesman and other owners like him will be able to transfer or sell development rights for the parcels underneath and adjacent to the rail line so that they can build even higher on parcels farther away. So Mr. Gottesman became a developer instead. The status of his project is unclear, and neither he nor others at his company, Edison Properties, returned telephone messages.
But the chairman of the local community board, Lee Compton, said board members have seen plans, designed by Robert A.M. Stern Architects, for two towers, one 290 feet high and the other 390 feet, for a parcel to the west of the High Line between 17th and 18th streets.
Small developers like Mr. Naman and Mr. Kislin know that their projects will benefit a lot if the High Line corridor can somehow distinguish itself architecturally from other luxury-condo ghettoes around the city. So, in addition to boutique names like Roy and Denari, it’s important to get some real flash in the pan.
Enter the master! Frank Gehry’s first building in New York, the InterActivCorp Headquarters, is going up a half-block away from the High Line, just over on 11th Avenue between 18th and 19th streets. “It’s always been an area that has had a great deal of potential, and it’s one we have lots of confidence in,” said Joe Rose, a partner in the Georgetown Company, who is developing the project for InterActiveCorp, the massive media conglomerate that owns Ticketmaster, Expedia and Match.com.
That “confidence” may mean that Mr. Gehry’s first building, which should be completed by late 2006, may soon be joined by others.
Georgetown and Mr. Gehry may collaborate on two residential buildings just to the east of the IAC headquarters and adjacent to the High Line. Mr. Rose refused to give any specifics regarding his company’s future plans.
But Mr. Compton, the community-board chairman, said he participated in two video conference calls about the project with Mr. Gehry’s office, including one with the great architect himself. One building could go as high as 250 feet.
The Related Companies also has a project in the works, according to Mr. Compton and other officials, for the east side of 10th Avenue between 16th and 17th streets. It would also max out at 250 feet.
It’s the little sky-high strip of neighborhood that could!
One reason the zoning permits the Edison, Georgetown and Related buildings to go so high is that the companies get bonuses for ponying up. The three developers will give $22 million to the city, to be used to restore the portions of the High Line passing through their sites. In addition, the three developers have agreed to construct stairways, elevators, public restrooms and a storage shed for the park, according to a city planning official.
“A lot of people at first said that this would be great if it happened, but it’s never going to happen,” said Robert Hammond, who, with friend Joshua David, co-founded the group Friends of the High Line, which conceived of the park concept. “When people realized it was going to happen, they realized it was a great asset.”
“I don’t think it’s even important if [a building] looks out onto the High Line,” Mr. Hammond said. “It’s like Gramercy Park—you don’t have to look out onto the park, but it will increase your property values if you live near enough to get keys.” Mmhmm!
The tasty quid pro quo arrangements don’t extend south of 16th Street, since that area wasn’t affected by the rezoning. Still, developers down there in the meatpacking district are building up and over the High Line.
At 14th Street, the High Line Building will use an existing base spanning the rail line as a foundation for a 10-story office and retail edifice. Hotelier André Balazs is creating a 15-story hotel to span the rails at 848 Washington Street. The flashy owner of the upscale Chateau Marmont in Hollywood and Hotel Mercer in Soho is excited about developing a moderately priced hotel around the unique structure.
“Because we always do very site-specific places, the High Line is front and center in the entire conceptualization of this building,” said Mr. Balazs.
“No matter what you do—even if you are building from the ground up—you do have this fascinating train track running through your building,” he continued. “While it is obviously a new building in terms of its complexity, I think it is closer to a renovation.”
Reportedly, Mr. Balazs planned to build the first hotel of his Standard hotel chain in Manhattan a few years back at 210 Lafayette Street. But he opted against it, deciding to build the hotel on the High Line, utilizing the Soho land instead to develop One Kenmare Square, his 53-unit luxury condominium currently nearing completion.
Last summer, Mr. Balazs purchased two buildings at 454 West 13th Street and 856 Washington Street for $18 million, according to city records.
Initially, there was speculation that Mr. Balazs had chosen Gluckman Mayner Architects for the High Line project, the firm responsible for the Lafayette Street project. Despite some renderings that floated around popular real-estate blogs, Mr. Balazs ended up choosing Polshek Partnership Architects, whose work he describes at “elegant” and “flexible,” while emphasizing a “culture of collaboration.”
But there was one more additional requirement: The architect had to be Manhattan-based, preferably within walking distance. “In my mind, it was a given that whoever we picked had to be local,” Mr. Balazs said.
Speaking of locality, the Standard will be built just a few blocks from the glitzy Hotel Gansevoort, which opened in March 2004. However, Mr. Balazs’ hotel will be far less expensive than its luxurious neighbor. At the Gansevoort, rooms begin at $325; the Standard will provide accommodations starting at a third of the price.
After completing demolition of the industrial buildings three months ago, Mr. Balazs is looking forward to finalizing the hotel’s plans. However, other than admitting that he will lay the foundation in January 2006, he was unwilling to provide any juicy details.
West Chelsea, nurtured by the white-walled galleries lining the streets, has been a good place to drop a few million for several years now. The next luxury residential development to actually arrive, the Chelsea Arts Tower, is slated to open on West 25th Street in early 2006. The glass and concrete tower will reportedly offer to sell for about $1,000 per square foot. It’s indisputable that the High Line Park plan has made land underneath the structure suddenly valuable, but whether it will make the finished products on either side any more expensive than other Chelsea real estate is, well, speculation.
Follow Matthew Schuerman via RSS.