Former Meta, Buzzfeed Offices Could Be Next Conversion Candidate

Why It Matters

The conversion could unlock significant value in a market flooded with empty office space, while signaling a broader shift toward residential repurposing in Manhattan’s Midtown South.

Key Takeaways

• 500k+ sq ft vacant after Meta, Buzzfeed exits
• $235M mortgage placed in special servicing due to vacancy
• $75M estimated cost to convert 233 Park Ave S to residential
• Orda contributed equity; new mezzanine lender provided $150M cash
• Conversion hinges on lender approval despite Orda's lack of interest

Pulse Analysis

Manhattan’s office market has been reshaped by the pandemic and the rise of remote work, leaving a growing inventory of empty floors in prime locations. Tenants such as Meta and Buzzfeed have vacated large swaths of space, pushing vacancy rates in Midtown South above 30 percent. Developers and investors are increasingly looking at adaptive reuse as a pragmatic response, with city officials offering incentives to turn underutilized office towers into housing that can address the city’s affordability challenges.

The two Park Avenue South buildings illustrate how financing can drive a conversion agenda even when the owner is hesitant. A $235 million mortgage was moved to special servicing after vacancy eroded cash flow, and Orda Management secured a $150 million mezzanine loan while injecting additional equity. Lenders estimate a $75 million price tag to retrofit the 12‑story, 170,000‑sq ft structure for residential use, a figure that reflects the high cost of preserving large floorplates and tall ceilings. Although Orda has publicly said it has “no current desire” to alter the properties, the lenders’ approval is now a decisive factor.

If the conversion proceeds, it could set a precedent for other distressed office assets in the borough. Investors are watching the deal for clues about the risk‑adjusted returns of residential conversions versus holding onto vacant office space. City policymakers may also view successful projects as validation for zoning reforms that facilitate mixed‑use development. Ultimately, turning office towers into apartments could help replenish Manhattan’s housing stock while providing a lifeline to owners grappling with a post‑pandemic office slump.