Related’s 70 Hudson Yards Is Coming Online At The Right Time

With little new office construction on the horizon and tenants racing to secure trophy space, Related Companies’ latest Hudson Yards tower appears to be arriving at just the right moment. And it’s the largest project of its kind since the pandemic.

After landing Deloitte as an anchor tenant for 900,000 square feet at its under-construction 70 Hudson Yards tower, Related Companies is negotiating deals for roughly half of the remaining space, company representatives said. The 1.1-million-square-foot project is now a few months ahead of schedule, with Related expecting a temporary certificate of occupancy as early as summer 2028.

Construction began a year ago, just as Manhattan’s office market started to show signs of a sustained rebound. Leasing activity has continued to accelerate, fueled by demand for high-quality, well-located space. Hudson Yards’ availability rate fell to just 4.5 percent in this year’s second quarter, according to Colliers, leaving companies with expiring leases or plans to expand scrambling to secure space within the neighborhood.

“There’s a strong desire to be here and to grow within the campus,” Related’s Stephen Winter said. “It just felt like a no-brainer to introduce another office tower to Hudson Yards.”

The tower, co-developed with Oxford Properties Group, is the first of only a handful of new Manhattan office developments slated for delivery over the next several years. With Hudson Yards effectively full and Park Avenue vacancy for Class A and B buildings hovering at record lows, brokers say companies seeking large blocks in trophy towers have few options. Tenants have already leased 80 percent of the office space currently under construction in Manhattan, according to JLL.

The scarcity of new development has pushed companies to plan far ahead, with tenants signing leases years before projects are completed. Law firm Simpson Thacher & Bartlett inked a 916,000-square-foot lease at Extell Development’s 570 Fifth Avenue tower, which is slated for completion a few months after Related’s project. Meanwhile, insurance giant Starr and law firm McDermott Will & Schulte have already committed to major leases at BXP’s 343 Madison Avenue, another ground-up office project expected to deliver in 2029.

“If you want that type of top quality space, you need to make two-, three-, four-, five-year in advance commitments,” JLL broker Benjamin Bass said. “Otherwise, that space will be leased [by another tenant].”

That was the case when Deloitte signed an 807,000-square-foot lease at 70 Hudson Yards earlier this year, then later expanded its commitment by roughly 93,000 square feet in a deal valued at about $3 billion. Bass, who was part of the landlord’s leasing team, said Deloitte was looking to consolidate its offices and lock in enough space to grow its business.

“They were really focused on having the right platform to recruit and retain talent,” Bass said. “They fell in love with the neighborhood and the amenities that Hudson Yards and Related have delivered as a foundation of what they can offer to their employees and clients.”

Hudson Yards’ retail, restaurants and proximity to transportation and amenities have helped turn it into one of Manhattan’s top destinations for office tenants. The neighborhood that was once considered a risky bet is now competing head-to-head with Park Avenue. Law firms, tech companies, consulting firms and financial services tenants are all looking in Hudson Yards, brokers said.

“What happens is all these hedge funds, private equity guys go visit their competitors or colleagues or friends, and they see their workplace, and they’re like ‘We need to upgrade,’ and especially if they’re competing for talent,” CBRE broker Ryan Alexander said. “It almost feels like there’s a frenzy right now to lock in this trophy space.”

That frenzy has pushed rents into record territory.

“That part of town has well eclipsed the $200 a foot range and in some scenarios we’re hearing maybe eclipsing $300 a foot,” Bass said. “So it is the absolute upper echelon of market rent.”

A string of large leases has helped cement Hudson Yards’ transformation from a speculative bet into a sought-after office hub. In the past year, L’Oréal inked a 484,000-square-foot renewal at Related’s 10 Hudson Yards, trading platform Jump Trading signed a new 99,000-square-foot lease at Related’s 50 Hudson Yards and BlackRock inked a 194,000-square-foot expansion in the same building, to name a few.

“In any industry in New York, if a company’s thinking about where they’re going to locate, they can see that there are leaders in that industry and peers that are already here,” Related’s Andrew Cantor said. “It’s proven and tested, and each time a new tenant comes, it’s just adding further to the network effects and the center of gravity that Hudson Yards now has.”

Update: This story has been updated to reflect that the tower was co-developed with Oxford Properties Group.