60 Wall Street owner makes risky bet with $250 million renovation: ‘Pray or swim downtown’

The struggling Financial District’s brightest hope — and biggest challenge for its landlords — is 60 Wall St., the vacant, 1.6 million-square-foot tower where Paramount Group has launched a marketing and leasing campaign as it completes a $250 million transformation. dollars.

The 47-story tower developed for JPMorgan in the 1980s was most recently owned by Deutsche Bank, which sold Singapore sovereign wealth to GIC and Paramount for $1.04 billion in 2017. Although Paramount’s equity is only 5%, it is in hot spot as the face of real estate towers and property manager.

It’s a bold dive for Manhattan-based Paramount. FiDi office vacancies are 27% and 34% on its east and west sides, respectively, according to Cushman & Wakefield (the data does not include the World Trade Center area.)

Although other FiDi buildings are vying for large tenants, eyes are primarily on 60 Wall. (Surprisingly, none of the analysts on Paramount’s second-quarter earnings call brought it up.)

But a normally tight-lipped broker who isn’t involved in the building and asked not to be named told us it’s sink or swim for downtown depending on which tenants Paramount signs on. Even a big lease will change perceptions of the downtown office market.

Paramount Group, led by CEO and president Albert Behler, is one of the few companies strong enough to handle 60 Wall. Its global portfolio of 13.8 million square feet is primarily in Manhattan, where its holdings include 1301 and 1325 Sixth Ave., 712 Fifth Ave. and 1633 Broadway, home of hot Taiwanese restaurant Din Tai Fung.

Paramount is advertising 60 Wall as Wall Street, but not as you know it. A recent walk-through with executive vice president and head of real estate Peter Brindley revealed mostly column-free office floors with 13- to 16-foot ceiling heights and spectacular views previously known only to the employees of the previous tenants who occupied them all. building.

Above the podium level, the reimagined tower will still resemble the original Kevin Roche/John Dinkeloo design that combined neoclassical and postmodern elements. But it’s a whole new ball game below that.

The original lobby, an icon of excess in the late 1980s, was compared by critic Paul Goldberger to an ice cream parlor blown up on a monumental scale. Now, the privately owned public space (POPS) between Wall and Pine Streets is being transformed into a welcoming, triple-height atrium with a shingle roof cut across the tower’s podium and a 100-foot-long green wall.

Light will flood through new triple-height windows that rise through the former commercial floors. A large staircase and elevators should be connected to No. Metro lines 2 and 3 below.

A 30,000-square-foot rental amenity space will be installed on top of it. Terraces are being added to several office floors. An improved ventilation system that uses virus blocking, MERV 15 filtration is among a host of infrastructure and sustainability improvements.

Among other strengths, 60 Wall sits between 11 subway lines directly below or a few blocks away. Building employees will enjoy easy access to the Hudson and East River waterfronts, numerous restaurants, the reborn South Street Seaport, and shopping options from Century 21 to high-end Printemps, born in Paris next year , as well as at Brookfield Place and the WTC Oculus.

However, the leasing campaign, which will be led by CBRE, could face a rough patch. Despite rumors about American Express, no major companies are known to have signed term sheets anywhere downtown.

But there has been an increase in rent. Activity in May of 321,000 square feet eclipsed the five-year monthly average for the second time in 2024, according to CBRE. Year-to-date leasing of 1.02 million square feet grew 26% through 2023.

Brindley said, Tenant demand continues to improve and demand is concentrated around higher quality, better located assets. 60 Wall Street was designed well ahead of its time, incorporating elements of today’s new construction, such as high ceilings, virtually column-free spaces, strong infrastructure and spectacular views.

“Our investment will provide a market-leading tenant experience in a building that is easily accessible from all areas of the city and region.

Brindley said, Paramount is marketing multiple-user cards for more than 200,000 square feet each. Asking rents range from $70 to $90 per square foot.