The MTA has finally agreed to part with its long-vacant eyesore above the Jay Street subway station in Downtown — a move that could net millions for the cash-strapped transit agency and speed the revitalization of a derelict block.
The agency announced on Monday that it will vacate the city-owned, yet MTA-controlled, building at 370 Jay St. — and local elected officials were joyous.
“The city can finally move forward to transform 370 Jay St. into a job-creating economic anchor in Downtown,” said Borough President Markowitz. “[This will support] the growth of neighboring Class A tenants and existing academic and cultural institutions.”
The transportation authority still controls the lease — part of a much-larger agreement that gives the MTA various train rights of ways, structures, buildings and, indeed, the subway system, for a nominal rent. It is unclear if the MTA will merely sublease the lucrative space to another company or sell the building.
Many in Downtown are pushing for the latter in hopes of a redevelopment as a first class office building.
“We hope a developer will come forward and the building will be used for office space,” said Amy Spitalnick, a spokeswoman for state Sen. Daniel Squadron (D–Brooklyn Heights).
Downtown real-estate experts shared their jubilation, though some urged the city to use the space to expand the limited space available to small businesses, though it would be easier to just rent the property to a single large tenant.
“Space for businesses is needed in the small-size level or in bargain rents,” said legendary real-estate broker Chris Havens. “We don’t need more fancy office space Downtown.”
Havens said that 95 percent of the demand in Downtown and DUMBO is for space under 2,000 square feet. Given that demand, the building could be cut up into dozens, if not hundreds, of small spaces, which would drive the local economy even more than one tenant could, he said.
Local officials have criticized the MTA for neglecting the city office building for years, allowing it to fall apart as staffers were deployed elsewhere. Currently, the building makes a crummy first impression for visitors leaving the busy Jay Street-Metrotech subway station, and remains an eyesore in a neighborhood steadily undergoing a renaissance.
Concerned city boosters took to the streets in 2008 to demand that the Metropolitan Transportation Authority give up or sell its lease — but the agency instead announced plans to renovate the building at a price tag of over $150 million. Those plans went nowhere.
But this week’s decision to part with abandon the prime real estate comes amid continuing budgetary woes for the cash-poor agency. If the agency subleases, it could make tens of millions of dollars.
“These revenues represent just a very small fraction of the MTA’s capital funding needs [but] every bit helps,” said Jeffrey Rosen MTA’s director of real estate.
The MTA would get the cash from the sale or lease of the building, part of which will pay for the expensive relocation of MTA communication equipment, according to MTA spokesman Aaron Donovan.