The duo will redevelop the Grand Hyatt New York Hotel, which was once owned by Donald Trump.
TF Cornerstone and MSD Partners plan to demolish the Grand Hyatt New York at 109 East 42nd Street to make way for a new 2 million SF office tower. The new building will include retail space and a scaled-down hotel. The buyers are taking over Hyatt’s lease, which expires in 2077.
Worth Noting: The deal requires approval from the city and state because the land is owned by the Empire State Development Corp, according to the WSJ.
Be Smart: In 2016, the buyers acquired a 90 percent stake in 1.35 million SF of air rights tied to Grand Central Terminal for $126 million. They subsequently sold 660,000 SF of the development rights to JPMorgan in December.
Midtown East Rezoning: Owners of landmarked buildings may sell their unused development rights anywhere in the district. On such sales, the city collects either $61.49 per SF or 20 percent of the total cost of the air rights, whichever is higher. The rezoned blocks run from East 39th Street to East 57th Street, from Third to Madison Avenues. Landmark air rights within the boundaries total around 3.6 million SF.