Extell Development Lands $425M for Manhattan MOB

1520 First Ave. Rendering courtesy of Extell Development Co.

Extell Development Co. has secured a total of $425 million in construction financing for a 30-story medical office building on Manhattan’s Upper East Side. To yield 420,000 square feet of rentable office and retail space, the project is slated for completion in 2025.

Harbor Group International secured a $90 million senior mezzanine loan for the development. Additional financing was provided by a consortium of investors, including InterVest Capital Partners, Rexmark and Pacific Western Bank.

The building will encompass more than 390,000 square feet of rentable medical space, as well as ground-floor and lower-level retail space. The Hospital for Special Surgery has preleased a 196,000-square-foot portion of the project.

The building will rise at 1520 First Ave., in proximity of other top health-care providers, Central Park and the East River. Several transit options, such as MTA bus stops and the MTA 6 subway line’s stations, are within walking distance.

Extell’s project will add sought-after space to New York City’s medical office inventory. The health-care sector has been leading office development in the past years, with NYC having the second largest life science employment base in 2021, after Boston. As demand for traditional office space is down, office-to-lab conversions offer a viable solution for revitalizing underused office buildings.