Timeka Jones, a native New Yorker who works between Park and Lexington avenues, likes to go out at lunch to get fresh air and clear her head, and she is far from the only office worker in the neighborhood with the same idea.
“I see a lot of people out here for lunch, but there's no real place for us to go sit," Jones said in an interview as she sat near a fountain outside the Seagram Building at 375 Park Ave., two blocks south of her workplace. "Everybody comes out at the same time. … Everywhere is crowded."
She and other office workers may get some relief soon. New York wants to give a major makeover to Park Avenue, a street that's famous for its who's who list of corporate headquarters in the largest U.S. office cluster. The move comes as the city seeks to revitalize its office-dependent areas and other commercial business districts to make them more friendly as a live, work and play domain.
At the same time in New York and nationally, outdoor access to green space is considered a prized office amenity and touted by employers seeking to attract talent and get workers to return to the workplace.
New York Mayor Eric Adams' office and the city’s Department of Transportation are moving ahead with the Park Avenue project by searching for a contractor with a background in landscape architecture or urban design to help expand and fill in the median between East 46th Street and East 57th Street. The city didn't give details on how car traffic will be affected or immediately respond to a CoStar News request seeking details. But according to the Department of Transportation website, the plan could involve removing one vehicle lane in each direction of Park Avenue for the wider median.
More public seating
The vision involves adding greenery, public seating, concessions, cycling infrastructure and “innovative streetscape amenities,” the city said. While there are different courtyards and some public spaces on side streets or a block or two away, on the main stretch of Park Avenue itself, there are few public seating areas, with the Seagram Building’s fountain area being one of the exceptions.
Adding an amenity such as an outdoor park could pay dividends for the prime office corridor.
Park Avenue is home to major global corporations including Blackstone, the major private equity firm that's expanding its footprint at its longtime home at 345 Park, and JPMorgan Chase, the banking giant that's building its new headquarters tower at 270 Park. Billionaire investor Ken Griffin, founder of hedge fund Citadel, is moving forward with a plan to build a 1.8 million-square-foot office tower at 350 Park after Citadel is already the anchor tenant at 425 Park, the first full-block office tower to open on Park Avenue in a half-century.
“I think it'll be nice for the area,” Jones told CoStar News, referring to the city's plan. "It's going to be nice for tourists [too] because they come and they want to find special areas that have stuff they can go and see. … It's bad for traffic, obviously.”
Naysayers have been proved wrong about leasing activity along Park Avenue, a stretch that was hard hit during the pandemic because of its predominantly office-centric nature. The market has shown solid demand despite what’s often pitched as the live-work-play appeal of rival neighborhoods such as Midtown South, Lower Manhattan and Hudson Yards.
For instance, SL Green Realty, Manhattan's largest office landlord, has noted higher rental rates and lower office availability on Park Avenue, with Chief Executive Marc Holliday recently saying tight supply has sent office tenants "radiating outwards" through East Midtown.
Steven Roth, Vornado Realty Trust's chairman and chief executive, said in his closely followed annual shareholder letter in April that Park Avenue had an office vacancy rate of under 7%, with rents going for what he described as a range from the mid-$80s to $120s. In contrast, New York’s office vacancy is still at what CoStar data shows as a near-record high of close to 14%. A number of addresses in the Park Avenue market commanded top-dollar rents last year as $100-plus per-square-foot leases in Manhattan reached a record high, a JLL study found.
The city's plan to put the park back in Park Avenue arrives as the Metropolitan Transportation Authority is overhauling and repairing the Grand Central Terminal train shed that sits below the street. The work will involve removing and reconstructing portions of Park Avenue in stages.
“As the MTA works underground to shore up our train infrastructure, we are taking this unique moment to make the vital artery, Park Avenue, a destination,” Deputy Mayor for Operations Meera Joshi said in a statement. “Lighting, furniture, and concessions will create more of the vibrant space.”
Nearly a century ago, pedestrians once strolled down Park Avenue when the median separating vehicle traffic was wider. It functioned as a public space before being narrowed in 1927 to accommodate more traffic lanes, according to a Department of Transportation study.
Business benefit
“As the owner of several buildings in the Grand Central neighborhood, including the upcoming 175 Park Avenue, the Park Avenue redesign is the kind of forward-thinking program that will not only benefit businesses — large and small, but, most importantly, the broader public,” Scott Rechler, chairman and chief executive of New York-based real estate developer RXR Realty, said in an emailed statement to CoStar News.
175 Park Ave. is a project RXR plans to co-develop by Grand Central Terminal that will involve a nearly 1,600-foot-tall tower billed to have the highest occupied office floor and highest hotel in the Western Hemisphere. RXR also owns the iconic Helmsley Building that straddles Park Avenue just north of Grand Central.
The city said an “overwhelming majority” of over 1,700 respondents in an online survey favored a redesign of Park Avenue with expanded medians allowing for enhanced pedestrian space and potential to create additional capacity for seating, art, concessions, landscaping, or possible bike connections.
Funding for the project will come from the East Midtown Governing Group, created as part of the 2017 Greater East Midtown Rezoning that allowed for new office development and the sale of development rights that come with required contribution to public realm improvements.
“I am from Georgia, and I like nature,” Eric Simmons, who works in the area and was taking his lunch break recently in a public courtyard just behind 432 Park Ave. by 56th Street, told CoStar News. “Midtown, particularly over here, is lacking in character and nature and sort of more earthly accouterments. … The thought of more green things and more vegetation is nice.”
Park Avenue isn't the only stretch the city is redesigning in its push to rejuvenate commercial districts that were hard hit during the pandemic. In another example, the city said it seeks to reimagine Fifth Avenue from Bryant Park at 42nd Street to Central Park at 59th Street as a “safer, less congested, pedestrian-centered boulevard.”
High-quality public spaces are “a vital component of our vision to revitalize commercial corridors like Midtown,” Adams said.