The talks to this point are quite secretive and few have been willing to discuss the proposed deal at the risk of seeing it fall through for one reason or another. JPMorgan Chase & Co. (NYSE:JPM) is looking to both the state and city to provide subsidies to the project that would ultimately provide space equivalent to that of two Empire State Buildings. The two towers that Chase are looking to erect would be built at Hudson Yards on the north side of 33rd Street, between 10th and 11th Avenues.
Apparently, negotiations between JPMorgan Chase & Co. (NYSE:JPM), real estate developers and the aforementioned governments nearly broke down earlier this week as Chase looks to build a new home for its 16,000 New York employees. Both the state and city governments are on knife’s edge with regards to subsidizing the project as Chase continues to cut down its work force in NYC.
Once a haven for criminal mischief, warehouses, and the tenements that provided the former, Chase’s presence would go a long ways towards the continuing transformation of the neighborhood.
While New York Governor Andrew M. Cuomo has faced a barrage of attacks from critics who claim his interests are far too corporate, Chase expects subsidies that he will unwittingly provide. Money rules the world and even fellow Democrat, New York CIty Mayor Bill de Blasio, will ultimately give in to Chase’s demands in a departure from his campaign promises.
End of the day, JPMorgan Chase & Co. (NYSE:JPM) is a large employer and isn’t going anywhere. The construction alone will provide thousands of jobs and Chase knows this. That said, it’s believed that Chase has whittled its “demands” down considerably in recent days in order to get the deal done.
“There’s no way that the city would entertain a demand for a billion dollars in additional incentives at Hudson Yards,” said Alicia Glen, the deputy mayor for economic development. “We have always been willing to engage with them in a dialogue about how we could be helpful in making a move more feasible.”
JPMorgan V. Related
In addition to governmental concerns, JPMorgan Chase & Co. (NYSE:JPM) has to deal with Related Companies, a prominent NYC developer, which is presently in the midst of a $15 billion development of the Hudson Yards. Related owns the sites that Chase has its eyes on but Chase has made it clear that it might not use Related to build its proposed towers which throws another wrench into any potential deal.
“We don’t have a deal yet,” Related’s chairman, Stephen M. Ross, said on Thursday. “I don’t know if we can make one. A lot depends upon the city and the state.”
Presently, JPMorgan Chase & Co. (NYSE:JPM) calls two buildings located at 270 Park Avenue and 383 Madison Avenue home and when they sell will reap a premium in today’s market.