The wave of office-to-residential conversions in New York City is facing new challenges, less than a month after supports gave way at a similar project in Midtown, the former Pfizer headquarters. Last week, the New York City Department of Buildings (DOB) issued a stop work order for the project at 222 Broadway in the Financial District. There, GFP Real Estate is converting the former 31-storey office building into a luxury apartment tower with 788 units.
The order, first reported by The Wall Street Journal, came after city inspectors found that the project's general contractor, Leeding Builders Group, and the engineering firm DeSimone Consulting Engineers, had not promptly reported cracks on the newly added 32nd floor of the Lower Manhattan building. A GFP spokesperson stated that the cracks on the top floor had been discovered in March and swiftly rectified. The building is stable; the stop work order resulted from the question of when the damage should have been reported, and is not due to 'safety issues', the spokesperson said.
The developer indicated that leasing is underway and completion of the project is expected within a year. A GFP spokesperson stated that "our structural engineers immediately identified and addressed this issue during the inspection in March, and we subsequently had the proposed repairs reviewed by an independent structural engineer to ensure they were safely completed." The spokesperson emphasised that "at no point during construction was the stability of the building compromised."
The 222 Broadway project is part of a larger series of office-to-residential projects across New York City, totalling over 16,000 units. Despite the headlines resulting from the conversion of the Pfizer building by MetroLoft and David Werner Real Estate Investment – the largest office-to-residential project nationwide – capital investment in these projects is not expected to wane, according to Commercial Observer.
Leeding Builders Group, DeSimone Consulting Engineers, and the DOB did not immediately respond to requests for comment. Development projects in New York City remain a central topic in the international real estate market and continue to require close observation. The conversion of office space into residential accommodation is regarded as an important strategy for addressing the housing shortage.
