St. Patrick's Air Rights To Aid Park Avenue Renovation: Report

MIDTOWN MANHATTAN, NY — St. Patrick's Cathedral has agreed to sell a portion of its air rights to aid in the renovation of a Park Avenue office building, marking the second East Midtown air rights deal in recent weeks, according to reports.

The Archdiocese of New York will sell off 30,000 square feet of its development rights to MRP Realty and Deutsche Bank Asset Management for about $10 million Crain's New York first reported. The deal will net the archdiocese about $7.2 million in profit after dedicating a portion of the total sale amount to fun public improvement projects, according to the report.

St. Patrick's Cathedral is the owner of more than 1 million square feet of air rights, Crain's reported. With the Archdiocese set to make more than $7 million by just selling a fraction of those rights, the institution is due for a payday exceeding $200 million should it be able to sell off all the site's air rights at the same price.

MRP Realty and Deutsche Bank Asset Management will use the development rights to renovate 405 Park Avenue, an office building located on the corner of East 54th Street, Crain's reported. The building was purchased in 2016 for $237 million, according to public real estate records.

The deal marks follows JPMorgan Chase's agreement to purchase about 700,000 square feet of air rights from Grand Central Terminal. Both deals were enabled by an East Midtown rezoning plan passed by the city in 2017.

The city rezoning stipulates that in exchanges of air rights, the sellers must pay the city $61.49 per square foot in order to fund improvements to East Midtown's public spaces, transit and infrastructure. City officials predict the rezoning plan will generate 6.8 million square feet in new commercial office space over the next 20 years and that an additional 6.6 million square feet of existing office space will be upgraded into Class A office space.

The East Midtown rezoning area spans 78 blocks from the east side of Third Avenue to west side of Madison Avenue between East 39th to 57th streets.

Read the full Crain's report here.

Photo by Google Maps street view