The architect trying to revive New York’s tired office skyscrapers

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The architect trying to revive New York’s tired office skyscrapers

Dan Shannon is willing to design a new Manhattan office tower if the client so desires. However, Shannon, the managing partner of New York City’s architectural firm MdeAS, is often asked to breathe new life into old buildings.

He has earned a reputation as one of the city’s leading figures, what architects and developers call “relocation.”

Demand for that particular trade is driven by the world’s largest office market upheaval caused by the Covid-19 pandemic, followed by the rise of telecommuting. Modern and flashy office buildings still attract top tenants, but half-baked towers run the risk of being forced to upgrade or becoming obsolete.

“It’s a pedal to metal,” Shannon said of his workload. “For each new building, do 10 or 15 conversions, and it’s the same for the entire city.”

Among other projects, Shannon is working on the almost complete internal organs of the former One and Two Pen Plaza, a monotonous tower of the 1970s approaching Pennsylvania Station, for the Bornado Realty Trust. Update of the so-called Lipstick Building on 885 Third Avenue on SL Green Realty. Solution Maglow Hill Building on 42nd Avenue for real estate partners.

Most recently, Shannon was tapped by Harbor Group International to revive the BlackRock Building on Six Avenue, a 1960s modernist landmark that was home to William Paley’s CBS broadcast network.

Dan Shannon was used by Harbor Group International to revive the BlackRock Building on Six Avenue, a 1960s modernist landmark that was home to William Paley’s CBS broadcast network © Pascal Perich / FT.

“How do you re-polish BlackRock and inject what today’s tenants are looking for?” Shannon asked.

Approximately 70% of New York’s 440 million square foot office space is pre-1980 and is ripe for dismantling or upgrading. If the developers were stalling about the refurbishment, Covid seems to be compelling their hands.

Uncertainty dominates among New York developers, but offices are a more vibrant and attractive space to seduce workers who are accustomed to the comfort of studio apartments and local Starbucks. There is a consensus that we must become. That means there are facilities such as a restaurant, wine bar, yoga studio and gym. It also means clean air, natural light, and outdoor space.

“People now want something sexy and high quality,” said Joe Iacono, a commercial real estate lender whose company, Crescit Capital. “Now it’s hard to even know the value of an old stock office building in New York.”

Environmental pressure is also working. Like other regions, the New York City Parliament supports regulations that limit the amount of greenhouse gases that buildings can emit. Violators will be subject to increasingly severe penalties over the next few years. Even without such rules, developers say tenants are demanding more energy-efficient buildings to meet their own climate policies.

New construction is one response. Wonder Built, a state-of-the-art tower next to Grand Central Station, which SL Green recently opened, manages rents in excess of $ 200 per square foot. The new JP Morgan headquarters are a few blocks away.

But for others, the relocation makes sense. It tends to be faster and less expensive than new construction. It also reduces zoning problems. One question is whether investors can get a faded building at a low price enough to profit after costly refurbishment.

The same was true for 100 Pearl Street, a 26-story tower in the financial district built in 1983. GFP and Northwind Group paid $ 308.5 million for partially occupied real estate in 2018. It included a new food hall, upgraded elevators and mechanical systems, a rooftop lounge, and a new penthouse. In December, they sold 100 pearls (currently over 90% leased) to Commerz Real in Germany for $ 850 million.

“It’s hard to survive along the way,” says Jens Böhnlein, Global Head of Asset Management at Commerz Real, a lesson learned from the project.

Even Shannon, even the best architects, admits that not all office towers in New York can be saved. Some are in poor location or have other incurable warts and are not worth the investment. Some people may only undergo shallow or imitation refurbishment that cannot stimulate potential tenants. Meanwhile, there is increasing talk about turning some office towers into homes. This is a much more complicated task.

“Previously we were lonely,” Shannon said of the crowded deal. “Now it’s a real market, and that’s a good thing.”

Originally from Louisville, Kentucky, he came to New York in 1983. This was another difficult time for New York. He acknowledges Harry McCrow’s work, which reminded his fellow developers of the possibility of relocation after success at General Motors Building on Fifth Avenue. Macklowe was purchased in 2003 for a record $ 1.4 billion at the time and was refurbished at an additional $ 150 million. Shannon helped redesign the lobby and plaza, giving way to the iconic Apple store. GM sold it for $ 2.8 billion five years later.

“People have realized that you can take such a reduced building and make it work like no other,” Shannon said.

Former Two Pen Plaza in New York

Dan Shannon is working on the almost complete internal organs of the former Two Pen Plaza, a monotonous tower of the 1970s approaching Pennsylvania Station © MdeAS

Former Two Pen Plaza in New York

Among other changes, the dark look of PENN 2 will be repainted and the rooftop and terrace will be covered with foliage © dbox

At Pen Plaza, Vornado CEO Stephen Ross raised Ante. The redevelopment aims to throw a halo in the night corner of Manhattan and provide some punishment for the architectural crime of destroying the original Pennsylvania in 1963.

“He said,’Dan, I don’t want a refurbished building. I want a new one.” Shannon, who is working on the project with Brad Zizmor, an architectural firm A + I, said.

The tower has been renamed to PENN1 and PENN2. The former, fashionable new three-story lobby shows that when completed, it has only a transient similarity to its former self. Among other changes, the dark look will be repainted and the rooftop and terrace will be covered with foliage.

The aim is to incorporate the gloomy 1970s design and brighten it up for a new era. To improve energy efficiency, the new windows use triple glazing and the air conditioning system is distributed throughout the building, allowing for cleaner air and more customized cooling.

BlackRock’s work is not that extensive. This is because the tower designed by Eero Saarinen was ahead of its time in providing high ceilings and natural light, which are highly valued by office tenants today. Still, architects Vocon’s Shannon and Tom Vecchione want to illuminate the recessed lobby, which he describes as a “dark hole.” They also break the layout of the internal office and install new mechanical systems.

“The leap to quality in New York is clearly happening,” said Jim Barros, managing director of Harbor Group, who hired Shannon to revitalize BlackRock. “We really want to not only paint, but restore and enhance it.”

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