Well sort of.

Previously leased to Macmillan Publishers for the last 60 years, the building has been sitting vacant since 2019 and supposedly needs something like $100 million in CapEx to make it leasable again. Four of the five current owners have wanted to renovate it, but the fifth kept blocking it, and so the other partners sued for a "partition auction."

That auction happened last week, and even though the four owners were really trying to lock down the 25% share that they didn't own, the auction was won by an outsider at $190 million. That said, a 10% deposit was to be due the following day and, apparently, that never happened. So maybe it hasn't sold yet. But whatever, it's still interesting to think about its purchase price.

According to Wikipedia, the Flatiron Building is 255,000 square feet. So at $190 million, the building was "purchased" for $745 per foot. Assuming that it needs another $100 million, that's another $392 psf, for a total of $1,137 psf.

What I am curious about now is how this compares to other office buildings in midtown Manhattan. Is there any sort of premium for being the Flatiron Building? And what would space in this building lease for following a renovation? i.e. What cap rate is the market demanding right now for an empty office building needing $100 million in renovations? Or, is the play to convert to residential?

I don't know enough about the real estate market in midtown Manhattan to answer these questions with any sort of precision, but I'm hoping some of you do and that you'll leave a comment below.

I recently got lost looking through the Toronto Archives for old photos of my neighborhood. I’ve blogged about what the St. Lawrence Market neighborhood looked like in the 70s, but I wanted to go back even further. I wanted to see what exactly had been demolished and lost over the years.

But by the end of it, I was just sad. As a lover of cities, it always makes me upset to see great buildings disappear. I think you too will be surprised at what I found.

The following picture depicts the north side of Front Street East, about 2 blocks east of Yonge Street. I don’t know what year it is, but look at how stunning these buildings are. It looks like Soho, New York meets some glamorous European capital.

Can you imagine what we could do with these buildings today?

If there’s any doubt in your mind that this is Toronto or that it’s Front Street East, take a look at the spire in the far left hand side of the picture. It belongs to the Toronto Board of Trade Building, which used to sit at the north east corner of Yonge Street and Front Street. When it was built in the late 1800s, it was considered one of the first “skyscrapers” in Toronto. It was demolished in the 1950s.

Here’s a picture of the Board of Trade Building so that you can compare. Again, take a look at the spire.

For those of you who might not be familiar with the area, here’s a map to help you out. The Board of Trade Building is shown on the bottom left hand corner. And the buildings in the first picture are in the triangular land area between Wellington and Front.

Now, let’s fast forward to the late 1960s. Those same buildings shown in picture number one have been demolished and in their place is the following parking lot. It’s a bit less glamorous looking. There are still heritage buildings on the south side of Front Street, but the balance of the area seems to have been blown out. What a shame.

Finally, here’s an aerial view of the area. It’s also from the late 1960s or early 1970s. You can see the same triangular land area, with only the Flatiron Building still standing at the very tip of it.

Obviously the St. Lawrence Market has come a long way since the 70s. That triangular area has since become Berczy Park, which is actually in the midst of being completely revitalized, and all of those parking lots have been filled in. But I still can’t help but wonder what the neighborhood would be like today had we preserved all of those heritage buildings. 

I think cities work best when you can figure out that delicate balance between preservation and progress. It’s not always the simplest approach, but as most things in life, the right decisions are often the toughest ones to make.

Well sort of.

Previously leased to Macmillan Publishers for the last 60 years, the building has been sitting vacant since 2019 and supposedly needs something like $100 million in CapEx to make it leasable again. Four of the five current owners have wanted to renovate it, but the fifth kept blocking it, and so the other partners sued for a "partition auction."

That auction happened last week, and even though the four owners were really trying to lock down the 25% share that they didn't own, the auction was won by an outsider at $190 million. That said, a 10% deposit was to be due the following day and, apparently, that never happened. So maybe it hasn't sold yet. But whatever, it's still interesting to think about its purchase price.

According to Wikipedia, the Flatiron Building is 255,000 square feet. So at $190 million, the building was "purchased" for $745 per foot. Assuming that it needs another $100 million, that's another $392 psf, for a total of $1,137 psf.

What I am curious about now is how this compares to other office buildings in midtown Manhattan. Is there any sort of premium for being the Flatiron Building? And what would space in this building lease for following a renovation? i.e. What cap rate is the market demanding right now for an empty office building needing $100 million in renovations? Or, is the play to convert to residential?

I don't know enough about the real estate market in midtown Manhattan to answer these questions with any sort of precision, but I'm hoping some of you do and that you'll leave a comment below.

I recently got lost looking through the Toronto Archives for old photos of my neighborhood. I’ve blogged about what the St. Lawrence Market neighborhood looked like in the 70s, but I wanted to go back even further. I wanted to see what exactly had been demolished and lost over the years.

But by the end of it, I was just sad. As a lover of cities, it always makes me upset to see great buildings disappear. I think you too will be surprised at what I found.

The following picture depicts the north side of Front Street East, about 2 blocks east of Yonge Street. I don’t know what year it is, but look at how stunning these buildings are. It looks like Soho, New York meets some glamorous European capital.

Can you imagine what we could do with these buildings today?

If there’s any doubt in your mind that this is Toronto or that it’s Front Street East, take a look at the spire in the far left hand side of the picture. It belongs to the Toronto Board of Trade Building, which used to sit at the north east corner of Yonge Street and Front Street. When it was built in the late 1800s, it was considered one of the first “skyscrapers” in Toronto. It was demolished in the 1950s.

Here’s a picture of the Board of Trade Building so that you can compare. Again, take a look at the spire.

For those of you who might not be familiar with the area, here’s a map to help you out. The Board of Trade Building is shown on the bottom left hand corner. And the buildings in the first picture are in the triangular land area between Wellington and Front.

Now, let’s fast forward to the late 1960s. Those same buildings shown in picture number one have been demolished and in their place is the following parking lot. It’s a bit less glamorous looking. There are still heritage buildings on the south side of Front Street, but the balance of the area seems to have been blown out. What a shame.

Finally, here’s an aerial view of the area. It’s also from the late 1960s or early 1970s. You can see the same triangular land area, with only the Flatiron Building still standing at the very tip of it.

Obviously the St. Lawrence Market has come a long way since the 70s. That triangular area has since become Berczy Park, which is actually in the midst of being completely revitalized, and all of those parking lots have been filled in. But I still can’t help but wonder what the neighborhood would be like today had we preserved all of those heritage buildings. 

I think cities work best when you can figure out that delicate balance between preservation and progress. It’s not always the simplest approach, but as most things in life, the right decisions are often the toughest ones to make.