A 335,000-square-foot office tower in Midtown South is set to undergo a transformative conversion into residential use, backed by a $90 million loan secured by David Werner Real Estate Investments and Metro Loft Management. The property, located at 675 Third Avenue, will be redeveloped into approximately 430 rental apartments in a move that aligns with the growing wave of adaptive reuse across New York City.
The financing, provided by Northwind Group through its Debt Fund III, will support both the acquisition and pre-development phases of the project. This marks the third major partnership between the borrower group and Northwind, following successful conversions of two former Pfizer buildings into a combined 1,600 residential units. Together, these ventures aim to deliver over 2,000 new homes to a market grappling with persistent housing shortages.
The shift from office to residential use reflects a broader post-pandemic real estate trend, particularly in dense urban centers like Manhattan where demand for commercial office space has softened while the need for housing continues to intensify. Converting aging or underused office buildings not only revitalizes outdated assets but also helps address the city’s urgent need for more rental inventory.
675 Third Avenue is strategically located in a corridor well-served by transit and amenities, making it an ideal candidate for residential repositioning. The development will offer modern rental units in a high-demand area, further diversifying the housing stock in Midtown South and contributing to the area’s urban renewal.
This latest deal also illustrates a continued willingness among lenders to back large-scale adaptive reuse projects, particularly those spearheaded by experienced operators with a proven track record. For Northwind Group, it signals confidence in the long-term value of repurposed urban assets in a shifting commercial landscape.
As hybrid work patterns and evolving urban demographics reshape demand across asset classes, office-to-residential conversions like this are becoming a key strategy in realigning real estate portfolios with market realities. The 675 Third Avenue project stands as a high-profile example of how thoughtful redevelopment can bridge the gap between surplus and shortage—reviving Midtown’s aging office stock while addressing the city’s housing crunch.
