New York’s Financial District is gaining hundreds of new rental apartments in a former office tower with East River views.
Leasing begins Friday at Pearl House, where the developer Vanbarton Group is transforming a 1970s-era building near the South Street Seaport into 588 luxury apartments. Rents at the property, with amenities including a bowling alley and hyperbaric oxygen therapy chamber, start at $3,500 for studios, $4,700 for one-bedroom units and $6,400 for two bedrooms.
Construction on the project, at 160 Water St., is set to be finished by the middle of next year. The conversion began after the pandemic hit, as it was becoming evident that many office tenants were permanently shrinking their workspace. Mayor Eric Adams has been pushing for more such overhauls to address the city’s severe housing shortage, especially in areas where office vacancies have soared in the past few years.
“The way that the market had shifted in 2021, from office to more of the residential, it made it much more clear” that the conversion made sense, said Joey Chilelli, managing director of Vanbarton.
The Financial District has swaths of aging or empty office towers that are ripe for similar makeovers. Also in the downtown neighborhood, GFP Real Estate and Metro Loft plan to convert a former JPMorgan Chase & Co. outpost at 25 Water St. into more than 1,000 apartments. And Metro Loft is working with Silverstein Properties to overhaul former Goldman Sachs Group Inc. offices at 55 Broad St.
Vanbarton is eyeing additional projects in the district as well as Midtown, where it plans to start work early next year on renovating a former WeWork space at 980 Sixth Ave. into roughly 100 rental units.
“It’s been a bit challenging to sift through the different opportunities, but we’re seeing them,” Chilelli said. “There will certainly be more over the course of the next five to 10 years than over the previous 10 years."
The Pearl House apartments are hitting the market as Manhattan rents have eased from the record highs set in July and August. The median asking rent in the Financial District was $4,500 a month in October, about $300 more than the boroughwide median, according to StreetEasy.
One major challenge for conversions is that office buildings often have large windowless areas that can be unappealing to apartment dwellers. At Pearl House, the design firm Gensler added five floors atop the existing 24-story tower and created three mechanical shafts with the property’s less-desirable space. The effect is “a metamorphosis that enhances the livability of the building,” said Robert Fuller, principal at Gensler.
Chilelli said he expects renters will mostly be in their 20s and 30s, ranging from new college graduates to established professionals who want to “upgrade” to the building’s finishes, amenities and plentiful closet space.
The apartments have Bertazzoni ovens, Bosch washer-dryers and Italian porcelain tile. Door locks, lighting and thermostats can all be controlled by smartphone. A lobby-level coffee bar, coworking space, fitness center with TechnoGym and Peloton equipment, cold plunge pool and indoor and rooftop lounge spaces give the building a private, clublike atmosphere, Chilelli said.
“I understand it’s New York, everyone wants to get out,” he said. But “staying in is the new going out. You can picture yourself staying within this property 24/7.”