A commercial site on Herald Square, owned by Jeff Sutton's Wharton Properties, is facing demolition. Last week, Florida-based hotel developer Keyah Real Estate Group filed plans with the city's Department of Buildings for the demolition of two retail buildings at 27–29 West 34th Street and 21-25 West 34th Street in Midtown Manhattan. This application, first reported by the New York Business Journal, paves the way for Wharton's long-standing plans to replace the low-rise buildings with a 26-storey hotel.
The demolition applications follow the closure of British apparel retailer Superdry's two-storey shop at 25 West 34th Street. Adjacent is 29 West 34th Street, a three-storey retail building which most recently housed a closed souvenir shop. The latter building was threatened with foreclosure by Germany's Helaba just over a year ago, as reported by The Real Deal. Wharton regained control of the property after the lawsuit was settled last month.
Project Scope and Background
The building plans filed by Wharton in August describe a 205,000 square foot hotel to be erected on the 15,000 square foot plot of the retail buildings. The development, designed by Manhattan architectural firm SRA Architecture + Engineering, is planned to include 340 rooms and a rooftop terrace. Wharton acquired the properties and a third adjacent building in 2006 alongside SL Green Realty and later bought out its partner's stake, according to TRD.
The developer's repositioning plans for the site date back to 2021, when the project comprised a 176,375 square foot hotel and retail building at 25 West 34th Street. Hotel and short-term rental operator Sonder was the primary tenant for that development, as reported by Commercial Observer, but that company collapsed into bankruptcy at the end of 2025. It is unclear whether a new operator has been found for Wharton's expanded hotel plans.
Market Conditions in Herald Square
The planned demolition of 38,000 square feet of commercial space at numbers 25 and 29 follows some challenging years for the retail landscape in Herald Square. The 34th Street corridor between Fifth and Seventh Avenue recorded a 30.5 percent availability rate in the second quarter of this year, based on data from Cushman & Wakefield. This figure, whilst an improvement on 2025, significantly exceeded the city-wide average of 11.6 percent. Spokespeople for Wharton and Keyah did not respond to requests for comment.
