300m+ of high-end skyscraper coming soon!
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Drake site demolition OK'd
Posted: 12:02 AM, April 19, 2011
Steve Cuozzo
REALTY CHECK
The owners of the bar ren Drake Hotel site have just gotten Buildings Dept. approval to demolish 44 E. 57th St., one of several retail townhouses that stand in the way of a proposed 70-story project they're straining to start. But don't expect it to shoot out of the ground overnight.
Despite the new demo permit and a recent filing for underground work, site owner CIM Group and its development "adviser," Harry Macklowe, seem to have a long way to go before above-ground construction can begin.
Sources say CIM, while downplaying Macklowe's role, is simultaneously tapping his skill as a bare-knuckles negotiator to try ousting pesky holdouts at the site.
SLOW PROGRESS: CIM Group, owner of the Drake Hotel site, has talked to several ultra-high-end hotel operators, but no deal has materialized.
Meanwhile, we're told CIM has talked to several ultra-high-end hotel operators to anchor the tower -- but no deal appears imminent.
At least more demolition is the cards on top of the razing of the Drake, which has left an empty lot at Park Avenue at 56th Street and doomed several handsome retail townhouses on East 57th.
The precious assemblage currently consists of the L-shaped former Drake land at 440 Park Ave. at 56th Street, which wraps around the office tower at 450 Park Ave., and five townhouses on East 57th.
CIM took over the properties last year, following a tussle that resulted after Macklowe, who bought the Drake in 2006 for $410 million, defaulted on a construction loan. It is unclear whether Macklowe's "advisory" role includes equity in the project.
CIM now owns Nos. 38, 40, 44, 46 and 50 E. 57th St. -- but it also covets No. 42, owned by Turnbull & Asser, and No. 48, owned by Jacob & Co. It also wants Buccellati to give up its lease at No. 46.
Gaining control of 42, 46 and 48 would permit construction of a 57th Street façade with 150 feet of precious sidewalk frontage, compared to about the 70 feet it can build using 38 and 40 alone -- or 101 feet with only 38, 40 and 42.
CIM is now ready to demolish vacant No. 44, immediately east of Turnbull. It will happen even as No. 40 to Turnbull's west continues to be dismantled under a permit we first reported two months ago. Demolishing the buildings on either side of Turnbull is a strong inducement for the menswear emporium to swap No. 42 for vacant No. 50 four doors east.
Meanwhile, sources said Los Angeles-based CIM has tried to lure Mandarin Oriental, Taj, and One&Only Resorts to operate a high-end inn on the lower floors, with luxury condo apartments to rise above them.
A bid to lure department store Nordstrom to the site several years ago is "ancient history," an insider said.
CIM declined to comment. A source close to the company insisted the project is entirely CIM's, that Macklowe is merely "an adviser," and that CIM is "very happy with the assemblage it now has."
However, we've learned that Macklowe has been in the thick of prolonged, heated negotiations with Jacob & Co. and Buccellati over possible buyouts.
Although Jacob says it has no intention of selling, an insider termed that "a negotiation tactic." The source said both jewelers nixed what they regarded as "peanuts" buyout offers.
A different source said Macklowe rejected their "demands" a few weeks ago in colorful, unprintable language.
Insiders said CIM and Macklowe have now told the retailers they will "build around" them. Such posturing on both sides is common in holdout battles, but it was unclear whether either side was willing to budge.
Turnbull is a different kind of holdout than Jacob or Buccellati. It's long been in talks with CIM to give up its building in exchange for 50 E. 57th only a few doors east of its current home.
Although nothing's firm, an agreement for Turnbull to move appears on track. CIM has filed with the city to "renovate" the interior of 50 E. 57th St.
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