Jarmulowsky Bank Owner Aborts Hotel, Decides on ‘Creative Office Space’ Instead

Posted on: June 8th, 2016 at 5:00 am by
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Let’s revisit the southwest corner of Orchard and Canal Streets…

It seems those long-running plans to convert the Jarmulowsky Bank Building into a trendy hotel (i.e. Ace Hotel) are apparently dead in the water. Building owner DLJ Real Estate Partners sent around an email blast yesterday to industry folk confirming that the certified Lower East Side landmark will instead house “creative office space” plus retail on the first two levels.

A reliable source, who asked to remain anonymous due to the sensitivity of the story, tells us that “multiple firms are working on marketing presentations” to pitch the battle-hardened, 12-story soldier as offices instead. A change in strategy. DLJ, for its part, is “sparing no expense” in the ongoing restoration of 9 Orchard Street (take note of the official address), and still plans to recreate the original cupola that crowned the building. (The Jarmulowsky has been behind scaffolding and netting for three years.) “Top tier tenants” are sought to occupy the 60,000 square-feet of space.

So far, though, there are no DOB filings to that effect.

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Meanwhile, you might notice that the official DLJ website does not mention this change of heart. Nevertheless, the communique allegedly comes straight from the owner. This pivot to commercial office space at the Jarmulowsky comes at a time when the city’s hotel sector is reportedly tanking. The Real Deal reported last week that:

But each of Manhattan’s hotel sectors is approaching today’s market, which is softening after a strong run, very differently.

At Manhattan’s toniest white-glove hotels — think the Waldorfs and the Pierres of the city — there are plenty of rooms going unbooked, but owners are keeping their rates sky-high. Meanwhile, according to industry players, the city’s limited-service hotels are slashing their rates in a frenzy to compete.

Of course, the initial intention here was to convert the property into an upscale boutique hotel. Ace Hotel had been rumored for the site from the beginning, and was pretty much the worst kept secret this side of Chinatown. Corporate all along denied any involvement, though.

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