A Local Developer’s Vision for Adaptive Reuse in NYC
As office vacancies remain high and remote work endures, could this be the future of Manhattan real estate? BCN Development's Craig Nassi thinks so.
As cities evolve, so too must their buildings. In New York City, the pandemic has dramatically reshaped the way people work and live, leaving many old office buildings underutilized. Local-born entrepreneur Craig Nassi, the founder & CEO of BCN Development, believes this shift is not a challenge but an opportunity to breathe new life into outdated structures by converting them into residential spaces.
His company is behind the redevelopment of 350 W. 38th St.—a historic, six-story Midtown Manhattan office building—into much-needed housing. Built in 1910, the building features nearly 30,000 square feet and, over the past three decades, has been utilized for various purposes. Following a $33 million investment, this NYC office conversion is set to add six new stories to the original structure, and create 60 units, including affordable ones.
From sustainable building practices to the future of Manhattan as a residential hub, Nassi shares his insights into how adaptive-reuse projects can help reshape the borough for generations to come.
Why did you decide to purchase this historic office building and turn it into a residential structure?
Nassi: Because the best use today for these sitting vacant office buildings is affordable residential. The office market in New York is rapidly diminishing. A large percentage of our office buildings today, especially these older inefficient ones, are sitting 50 percent vacant or more, as people choose to work from home. The market has never rebounded since the pandemic and no one believes it ever will because people are extremely efficient from home and they prefer to work from home and business owners prefer not to have the overhead of an expensive lease of unnecessary office space.
READ ALSO: The Rise of Office-to-Residential Conversions in NYC
What steps are being taken to ensure the affordable housing units truly serve the needs of the local community?
Nassi: This building will be 25 percent affordable, and the affordability component is real because it is attached to the tax abatement. These units will be affordable for many generations to come. The building will be marketed and put into the lottery for people who desire and want to live in this neighborhood.
It is our goal to try our hardest to attract people to the area and try to do whatever we can to get everyone’s attention that these buildings also are affordable and something for people to experience that have never been in the area. New York is about moving around every few years and enjoying the different neighborhoods. Many people in the past have been locked out of certain neighborhoods because there was no affordability and set aside units. This is not the case any longer.
How does this project align with your broader vision for urban revitalization in Midtown Manhattan?
Nassi: Our vision is trying to take as many of these outdated inefficient buildings and turning them into a special destination for living and socializing. The goal is to attract many more people to live in the great city and enjoy modern, efficient, clean, running buildings. As we all know, office buildings that are small and inefficient are becoming obsolete. There are no users or needs for office tenants in these types of buildings any longer. The sophisticated office users today are Fortune 500 companies that need large independent spaces that have all the criteria of modernization and green practices.
Speaking of green practices, what sustainable features do you intend to add to the new building?
Nassi: This building will terminate its oil use for heat as soon as we renovate. We will go to a clean solar system to provide efficiency. We will also create a two-inch layer of insulation that will be sprayed on all exterior walls and roof to create a truly efficient building for all weather types. The new window system will be highly energy rated to stop all leaks and temperature fluctuations.
The heat system will be an energy-efficient heat pump system, all operated by electric tied into our solar system. The building will have a rooftop garden and tenants will be able to actually garden their own crops in a communal setting. Also, we will have a large bicycle room to encourage people to ride a bike instead of taking public transportation and we will have an exceptional large fitness facility to encourage people to work at home and work out within the same building.
How will you balance between preserving the building’s historic character and adding 20,000 square feet of modern construction?
Nassi: The existing buildings facade will remain exactly the same. We will be able to preserve all of the wonderful details of this beautiful brick building. The 20,000 square feet or additional six stories going on top of the building will also fit into the spirit of the neighborhood.
Do you plan to pursue similar adaptive-reuse projects in other areas of New York City?
Nassi: We are very bullish on this product type. We believe that more inefficient older office buildings like this that do not have large floorplates and are not what office tenants want, will be converted to residential.
How do you expect Midtown Manhattan to evolve as a residential destination over the next decade? How does your project fit into that future?
Nassi: I believe the number one attraction of New York’s future will be tourism. A great city that people want to come and visit and experience. We feel many people around the world will want to have a second home here and/or find a place to rent for six months at a time while enjoying the city. As the world evolves, we also believe the need for office buildings will diminish and many people will choose to use these apartments as their offices and work from home, therefore making residential a quasi-work use.
