Richard AC Coles on the madness of Vanbarton’s office conversion

Richard AC Coles of the Vanbarton Group is in the running to become the king of home remodeling in New York City.

The developer has converted the boring office building in the Financial District at 160 Water Street into sleek luxury apartments. The company has three other office projects in progress in New York City: 77 Water Street, 1011 First Avenue and 6 East 43rd Street. There’s another one in Seattle.

Vanbarton’s conversion mania is fueled in part by 467 Million, a tax incentive passed in New York State in 2024.

“Once that happened, it was a shot in the arm for both owners and developers to say, ‘Huh, OK, they can actually do it and lean into it,’” Coles said.

Richard AC Coles of Vanbarton Group and Erik Engquist of TRD (photos by Radhika Chalasani)

Coles joined in The real deal Salon Series this month, hosted at TRD’s Manhattan office, to discuss a range of topics including remodeling, construction financing, and New York City’s new mayor, Zohran Mamdani.

Mamdani is targeting landlords as he pushes his affordability agenda. He created “Rental Ripoff Hearings,” which gave tenants a public forum to air their grievances about their greedy landlords. Mamdani has pursued other pro-tenant policies, including freezing rents for rent-stabilized units.

Coles said Mamdani’s victory in the Democratic primary against Andrew Cuomo sent shivers down the spines of some investors.

“The second time he won, global investors and offshore investors pulled out dramatically,” Coles said.

After Mamdani won the general election in November, “things started to cool down a bit, thaw a bit, but I still think in the deep inner recesses of the global investor they are taking a wait-and-see approach to New York,” Coles said.

The mayoral election does not halt Vanbarton’s construction projects.

The company is moving forward with its highly sought-after development location in Nomad. The site at 3 West 29th Street is next to Marble Collegiate Church and was put on the market last summer with an expected sales price of $250 million. Vanbarton previously had an eye for building development in the field of life sciences.

But with the rezoning of Midtown South, Coles said Vanbarton will build a residential project. He added that when the development is completed, it could be the largest in NYC with the help of the 485x tax credits.

Richard AC Coles of Vanbarton Group and Erik Engquist of TRD (photos by Radhika Chalasani)

“The banks are coming back in. Our hope is that by the time we are ready to go to the lending market, the banks will be ready to competitively embrace the type of construction loan that we need for that project,” Coles said.

Coles also expects to see more housing conversions in the Financial District and Midtown. But he notes that some parts of the Garment District will still need help.

“We see most, if not all, of the mid-block clothing buildings between 40th and 30th, between Fifth and Seventh, and those buildings are outdated,” Coles said.

He added: “Someone with a magic wand or an executive order has to come in and say, OK, we’ve got to create a tax incentive to encourage development and give it a shelf life, give it five years. But do something, because without that kind of initiative it’s just going to wither away.”