Rentals Cede Space to Condominiums on John Street

John Street, once home to the headquarters of insurance companies such as Travelers and AIG, and later to rental apartments for Wall Street employees, is undergoing another transformation, this time to condominiums.

"The lifestyle downtown is getting easier," the director of leasing and sales at Rockrose Development Corp., Kathleen Scott, said. "People are viewing it as a longer term commitment, as opposed to renters, who will go into any neighborhood and try it out. Now it's about home ownership."

John Street runs for just seven blocks in Lower Manhattan. On a three-block stretch, from Dutch to Cliff streets, nearly 800 rental units are being converted to condominiums.

Rockrose is behind the transformation of 442 rental units into condominiums at 99 John St., on the corner of Cliff Street. The building was converted from offices in 1998–99.

Much has changed since that phase of redevelopment. A 24-hour grocery, Jubilee Marketplace, is on the ground floor, and retailers such as Tiffany and Hermès have moved into the neighborhood. The cobblestone Front Street, two blocks north, is lined with restaurants and bars.

The changes come as downtown advocates expect the population below Chambers Street to increase by 20%, to 54,000, by the end of 2008.

"Originally you saw pioneers and singles coming," the president of the Alliance for Downtown New York and a 25-year resident of the neighborhood, Elizabeth Berger, said. "Now you are seeing couples, families, and new people from other neighborhoods."

At 45 John St., an office building built in 1907 and once owned by the Collegiate Church will get 84 new units. The developer, Manhattan Capital LLC, is also adding two penthouses onto the roof.

"It will have real high-end amenities like an iPod docking station and in-wall speakers, but at more affordable prices than many places in the rest of the city," the owner of Manhattan Capital, Stuart Katzoff, said. "I see this as getting in at the early ground level of something that is becoming revitalized. It's no longer a risk that it might go the other way."

The building is about half sold, with listings ranging from between $1,000 and $1,100 a square foot. The average price per square foot in the downtown area was about $1,200 in the third quarter, according to data from Miller Samuel. In 1998, when the rental conversions were first taking place, the price was about $350 a square foot, the data show.

"In terms of number of deals and conversions going on down here, it's really about John Street," Mr. Katzoff said. The apartments also will be outfitted with high-end appliances and washer-dryer units, and the building will have a Fresh Direct cold storage area and a live-in superintendent. Conversions at Five Nine John Lofts at 59 John St. and the South Star at 80 John St. are adding another 73 and 147 units, respectively.

"Although we are technically in the Financial District, when you look outside you see people walking dogs and going to the grocery store," a sales associate at South Star, Justin D'Adamo, said. "That is a big draw for people to come to us."

The building is 85% sold with average price per square foot sales in the $1,000–$1,100 range. Five Nine John Lofts is selling for between $850 and $1,050 a square foot.