The Revitalization of the Financial District Compiled By

Home , 125 Greenwich Street, 70 Pine Street, Lower Manhattan, The Rising (memorial), Tribeca

Ariel Property Advisors Presents The Revitalization of the Financial District Compiled by:

Analyst:

Brett Campbell 212.544.9500 ext. 27 [email protected]

Manhattan Sales Team:

Shimon Shkury 212.544.9500 ext. 11 [email protected]

Victor Sozio 212.544.9500 ext. 12 [email protected]

Michael A. Tortorici 212.544.9500 ext. 13 [email protected]

Randy Modell 212.544.9500 ext. 17 [email protected]

Howard Raber 212.544.9500 ext. 23 [email protected]

Jesse Deutch 212.544.9500 ext. 18 [email protected]

Ariel Property Advisors | 212.544.9500 | arielpa.com | 2 Neighborhood Report | The Revitalization of the Financial District

Introduction The Revitalization of the Financial District

The Financial District has historically been the heart of New York’s economic engine, support- ed by the booming financial sector, which was the city’s most prevalent industry.

Today, while the neighborhood’s office sector remains dominant, driven by creative tenants seeking space downtown, the residential market has been growing in prominence.

This, coupled with a strong tourism sector pro- pelled by the opening of 1 World Trade Center, has driven a retail market previously unseen in the area. In addition, some of the city’s best restaurants are moving downtown, establishing a renewed nightlife in the neighborhood.

This report will explore the changing landscape of the Financial District, including the rising residential market, expanding retail destinations, and changing office environment. All of these factors are combining to transform the Finan- cial District from a neighborhood dominated by the office sector, to a complete live/work community with amenities that rival the most desirable neighborhoods in Manhattan.

3 | Ariel Property Advisors 212.544.9500 | arielpa.com Neighborhood Report | The Revitalization of the Financial District Neighborhood Report | The Revitalization of the Financial District

Ariel Property Advisors | 212.544.9500 | arielpa.com | 4 Bx7 to Riverdale/ 1 263 St via BRIDGE BROADWAY Riverdale Av Bx20 to

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INWOOD 207 ST ISHAM ST TENTH AV TENTH

A W 207 St UNIVERSITY 207 St HEIGHTS DYCKMAN 1 NOUSE W 204 ST BRIDGE

DYCKMAN ST SEAMAN AV Bx12 to Bay Plaza ACADEMY ST VERMILYEA AV SHERMAN AV via Fordham Rd. and A BROADWAY Pelham Pkwy THE (To Orchard Beach summers only) CLOISTERN DYCKMAN ST MUSEUM W 201 ST 1

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1 W 191 ST FORT GERGEAV

A W 190 ST HENRY HUDSON PARKWAY W 190 ST

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W 130 ST Bx15 to Fordham

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BROADWAY CENTRAL ISLAND HARLEM RIVERSIDE MEER DUKE ELINGTON BLVD W 106 ST LASKER E 106 ST E 106 ST PARK RINK E 105 ST

W 105 ST MUSEO DEL FDR DRIVE FDR W 104 ST BARRIO E 104 ST MUSEUO OF THE 6 ROBERT F. KENNEDY BRIDGE W 103 ST 1 W 103 ST B C 103 ST 103 ST 103 ST CITY OF NEW YORK E 102 ST

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B D LUDLOW ST CANAL ST ORCHARD ST HUDSON GRAND ST Neighborhood Report | The Revitalization of the Financial District Grand St CHERRY ST RIVER 1 ELDRIDGE ST A C E East Canal St PARK Canal St Broadway CLINTON ST MONTGOMERY ST Canal St Canal St VARICK ST Canal St F

R 6 CENTRE ST E BROADWAY

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With the1 completion of Fulton Center, transportation in the Financial District has never been moreFranklin accessible. St Nine subway lines and the PATH Train are connected in a modern and conve- nient subway station, serving 300,000 daily commuters and supporting a new retail hub man- FRANKLINaged ST by the Westfield Group.

LAFAYETTE ST WORTH ST HARRISON ST

projected to serve CHURCH ST The complex is part of a Retail Hub by Chambers St Chambers St CATHERINE ST BMCC 1 2 A C Chamber St J Z F 300,0003 W BROADWAY $1.4 Billion CHERRY ST MANHATTAN BRIDGE NELSON commuters daily Development project PARK ROW CHAMBERS ST ROCKEFELLER 4 5 6 PARK ST JAMES PL B D N.END AV City N Q RIVER TERRAE 2 3 Hall MURRAY ST SOUTH STREET FRANKFORT ST SEAPORT

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J Z FULTON ST

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BATTERY M15 Local 4 5 SLIP 6 PARK NY WATER TAXI South Ferry 1

FERRIES TO: ELLIS ISLAND, PIER 5 STATUE OF LIBERTY FERRIES TO STATEN ISLAND (ST. GEORGE) Neighborhood Report | The Revitalization of the Financial District

Dominant Office Market TAMI (Technology. Advertising. Media. Information.)

The Financial District has seen a shift in office tenancy in recent years from the traditional finance and banking tenants to the emerging TAMI tenants. These tenants generally have sought sub-

prime office space (Class B or C), but now are seeking more Class A office space, driving demand for office units in a neighborhood with no shortage of office supply. From Q1 2011 to Q1 2015, 47% of relocations to the Financial District were TAMI tenants, showing a growing prevalence of creative tenants in a traditionally finance-driven office market.

Lower manhattan relocations by

industry Sector, q1 2011 - q1 2015

5% 7% 8% 10% 11% 12% 47% Education Law Consumer Other TAMI Professional Products FIRE*

*Finance, Insurance, and Real Estate Source: “Lower Manhattan Real Estate Market Overview, Q1 2015,” Alliance for Downtown New York

20+ Top 10 47% Ad Agencies Relocations (by Sq. Ft.) were Of Relocations Since 2011 Relocated to FiDi Nontraditional Tenants were TAMI Tenants

A Retail Destination

2 million of retail space planned in the near future Square Feet

$234/SF retail rent along major corridors 4% increase vs. 2H 2014

estimated retail spending potential $2.1 billion of Lower Manhattan employees

Tenants Coming to FiDi:

The neighborhood’s retail, including Westfield’s Fulton Center and the nearby Brookfield Place, benefits from the newly-completed One World Trade Center, a growing residential presence, and a booming tourism sector.

Ariel Property Advisors | 212.544.9500 | arielpa.com | 8 Neighborhood Report | The Revitalization of the Financial District

of retail space planned in the near future

retail rent along major corridors

estimated retail spending potential of Lower Manhattan employees

9 | Ariel Property Advisors | 212.544.9500 | arielpa.com Neighborhood Report | The Revitalization of the Financial District

An Emerging Residential Community

The Financial District is transforming into a residential New Residential Buildings destination, as numerous developments near com- 16 planned for Financial District pletion and several others are commencing. With a relative cost advantage to other areas of downtown Financial District Manhattan, such as TriBeCa and SoHo, FiDi is poised to experience a residential revolution. With a grow- 2,446 ing appeal, shops and restaurants are slated to move Units Planned to the neighborhood, including Le District at Brook- field Place, Eataly, and Nobu. 760 of which are condos

Proximity to TriBeCa makes FiDi relatively less expensive, which has driven price-conscious buyers to the neighborhood

$1,905 $1,260 TriBeCa CONDO average VS. FiDi Condo average

Change in residential appeal of the neighborhood (restaurants, bars and shops arriving)

Ariel Property Advisors | 212.544.9500 | arielpa.com | 10 Neighborhood Report | The Revitalization of the Financial District

11 | Ariel Property Advisors | 212.544.9500 | arielpa.com Neighborhood Report | The Revitalization of the Financial District

An Emerging Residential Community

Ariel Property Advisors | 212.544.9500 | arielpa.com | 12 Neighborhood Report | The Revitalization of the Financial District

New Construction

The Beekman (5 Beekman Street)

o gFI & GB Lodging o 68-unit condo tower attached to Thompson Hotel o price range from $1,600,000 to $15,300,000 (averaging $2,400/SF)

50 West Street

o time Equities o 191-unit condo tower designed by Helmut Jahn o price range from $1,800,000 to $22,600,000 (averaging $2,600/SF)

30 Park Place

o silverstein Properties o 157 units on top of the Four Seasons Hotel o designed by A.M. Stern o price range from $2,600,000 to $60,000,000 (averaging $3,200/SF)

125 Greenwich Street

o michael Shvo / Bizzi & Partners o 1,356 foot-tall tower o 128 units designed by Rafael Vinoly

13 | Ariel Property Advisors | 212.544.9500 | arielpa.com Neighborhood Report | The Revitalization of the Financial District

Conversion Projects

In addition to new constructions, developers have been taking advantage of the existing building stock that FiDi has to offer for residential conversion projects. Iconic office buildings such as the Woolworth Building and 70 Pine Street are undergoing conversions to luxury apartments, a sign of the neighborhood’s shifting appeal from an office and business hub to a residential destination.

Woolworth Building

o conversion by Alchemy Properties o price range from $3,400,000 to $110,000,000 (Averaging $3,200/SF)

70 Pine Street

o conversion by Rose Associates o Former home of AIG o 644 rental units and a 132-unit extended stay hotel

180 Water Street

o metro Loft Management is adding 7 stories and 9,000 sq. ft. of outdoor space o Former office building o 555 units o expected completion in Spring 2016

Ariel Property Advisors | 212.544.9500 | arielpa.com | 14 Neighborhood Report | The Revitalization of the Financial District

Financial District Reborn South Street Seaport Development

15 | Ariel Property Advisors | 212.544.9500 | arielpa.com Neighborhood Report | The Revitalization of the Financial District

South Street Seaport Development

$1.5 billion development

Plans include Pier 17, a 4-story retail development - completion set for 2017

Mix of retail, office, residential, with a multipurpose space for concerts, films and special events.

Residential condominium tower planned as well, but no plans have been approved by the city yet

Infrastructure improvements, as well as a new school and an improved Maritime Museum

Developed by:

Ariel Property Advisors | 212.544.9500 | arielpa.com | 16 Neighborhood Report | The Revitalization of the Financial District

Plans include Pier 17, a 4-story retail development - completion set for 2017

Mix of retail, office, residential, with a multipurpose space for concerts, films and special events.

Infrastructure improvements, as well as a new school and an improved Maritime Museum

17 | Ariel Property Advisors | 212.544.9500 | arielpa.com Neighborhood Report | The Revitalization of the Financial District WHAT’S NEXT

Ariel Property Advisors | 212.544.9500 | arielpa.com | 18 Neighborhood Report | The Revitalization of the Financial District

WHAT’S NEXT The Revitalization of the Financial District

Conversions and developments are just the tip of the iceberg, as the area WHAT’S completes its transformation into a prime residential neighborhood. Transforming skyline NEXT Residential developments will push the skyline to new heights

Booming population +170%

62,000 VS 22,900 people today people in 2000

While the Financial District has traditionally been a strong office hub, the neighborhood has recently diversified to include a desirable residential community as well. With the area’s recent developments, such as Brookfield Place andF ulton Center, along with some of the city’s most recognizable restaurants, the neighborhood’s growing residential appeal cannot be denied. As these projects move to completion in the coming months, and more details are revealed about the South Street Seaport mega-development, the Financial District will continue to de- velop into a true live-work community.

19 | Ariel Property Advisors | 212.544.9500 | arielpa.com Compiled by:

Analyst:

Brett Campbell 212.544.9500 ext. 27 [email protected]

Manhattan Sales Team:

Shimon Shkury 212.544.9500 ext. 11 [email protected]

Victor Sozio 212.544.9500 ext. 12 [email protected]

Michael A. Tortorici 212.544.9500 ext. 13 [email protected]

Randy Modell 212.544.9500 ext. 17 [email protected]

Howard Raber 212.544.9500 ext. 23 [email protected]

Jesse Deutch 212.544.9500 ext. 18 [email protected]

arielpa.com 122 East 42nd Street, Suite 1015, New York NY 10168 p. 212.544.9500 f. 212.544.9501

The information contained herein has either been given to us by the owner of the property or obtained from sources that we deem reliable. We have no reason to doubt its accuracy but we do not guaran- tee the accuracy of any information provided herein. As an example, all zoning information, buildable footage estimates and indicated uses must be independently verified. Vacancy factors used herein are an arbi- trary percentage used only as an example, and does not necessarily relate to actual vacancy, if any. The value of this prospective investment is dependent upon these estimates and assumptions made above, as well as the investment income, the tax bracket, and other factors which your tax advisor and/or legal counsel should evaluate. The prospective buyer should carefully verify each item of income, and all other information contained herein.