Lever House Is Getting A $100M Makeover
Brookfield and the firm led by its former head of real estate are embarking on a major renovation of Park Avenue’s Lever House as competition for office tenants heats up in the city.
The Canadian investment giant and WatermanClark plan to spend $100M revamping the 22-story, 260K SF skyscraper, ground-level public plaza, lobby and roof terrace, the firms announced Tuesday. Skidmore, Owings & Merrill, the firm that originally designed the 70-year-old skyscraper, has been tasked with its makeover.
The building at 390 Park Ave. is empty, a spokesperson for the developers said, and the renovations are expected to be wrapped up by next year. As part of the reimagining, Brookfield and WatermanClark are creating a tenant-only club, with a conference space and restaurant, that will connect to 15K SF of outdoor space.
"It's one of a kind, it's unique, it was built way ahead of its time and it gave us the ability to figure out how to make it one of New York City's — if not the world's — greatest assets again,” WatermanClark co-Managing Partner Ric Clark told Bisnow Tuesday.
WatermanClark is the investment firm Clark and Waterman Interests’ Philip “Tod” Waterman formed in late 2020 after Clark announced he would step back from his chairman role at Brookfield Properties in February of that year.
Waterman Interests and Brookfield took over the ground lease for Lever House in 2020 from its previous owner, Aby Rosen's RFR Holding, which had fallen behind on mortgage payments in 2018 before negotiating an exit with its lender. RFR's original lease with the landowner, the Korein family, was set to expire in 2023, but the Waterman-Brookfield venture negotiated a new ground lease as part of the takeover, which runs until 2100, The Real Deal reports.
Office buildings in New York City are under increasing pressure to offer top amenities and spaces in order to lure tenants to leases. While workplaces consider how much space they will be needing in the long term, more and more supply is coming online. There is around 25M SF of office construction that will be completed between 2022 and 2024, Colliers told Bisnow in October.
At Lever House, the developers said they plan to retain exterior paving, plaster ceilings and stainless steel columns. As part of the original detailing, the marble planter will be restored.
He said the developers are positioning the building as a "bespoke" office to appeal high net worth family offices, private equity firms and “world influencers." He didn't disclose what asking rents they will be targeting, only saying Lever House would likely lease at top-market rents for the city.
Tenants will be able to begin their own construction starting in the middle of this year, per the release. The landlords are targeting a host of certifications — LEED Gold, WELL, WiredScore Platinum, Energy Star and GRESB — and plan to install a ventilation system that will pull outdoor air directly into workspaces.
“There are not many [buildings] anywhere near this offering,” Clark said. “I’d really hate to own a building that competes with the masses right now. It's a tough market for that -- this is a pretty special offering, and unlike most things out there.”
UPDATE, JAN. 25, 5:45 P.M. ET: This story has been updated with comments from WatermanClark co-Managing Partner Ric Clark.
CORRECTION, JAN. 26, 9:10 A.M. ET: RFR, the previous owner of Lever House, turned over control of the property to the joint venture Waterman and Brookfield, but it wasn't foreclosed on, as a previous version of this article stated. This story has been updated.
