For Sale: Long-Litigated Right to Build a 324-Foot Tower at 250 Water Street

Howard Hughes Corp. bought this 48,000-square-foot 250 Water Street site at the Seaport from the Milstein family for $180 million. It had been a parking lot for many years. Photo: Carl Glassman/Tribeca Trib

Just 10 months after winning a three-year court fight to build their 324-foot residential tower at 250 Water Street, the owners of the site are looking to sell all or part of it. 

Last July, Howard Hughes Corp. spun off that $850 million project and other South Street Seaport assets to a new publicly traded company, Seaport Entertainment Group [1]. As first reported by Crain’s [2], Anton Nikodemus, chief executive of Seaport Entertainment, said in a conference call with shareholders this month that “the best value for the company is going to be realized either through an outright sale to a developer and an operator who specializes in multifamily and mixed use developments, or to partner with someone with this expertise.” The company’s share value is down more than a third from its initial public offering.

Hughes Corp. paid $180 million for the site and another $40 million to the city for air rights.

Michael Kramer, president of the South Street Seaport Coalition [3], which led the legal fight [4] against the project, said he wasn’t surprised by the news of the potential sale.

“We always suspected that Howard Hughes Holdings (now Seaport Entertainment Group) intended to sell the approvals and entitlements it secured from the city to the highest bidder,” Kramer said in a statement. 

The Coalition had fought the project, saying that its approval by the city’s Landmarks Preservation Commission (LPC) for a tower within the South Street Seaport Historic District was influenced by promised financial support for the struggling South Street Seaport Museum and by “direct coordination” between the de Blasio administration, the Landmarks Commission, and Howard Hughes lawyers and lobbyists. (After winning in a lower court, the Coalition lost its appeals.)

The approved project includes nearly 400 apartments, 80 of them below-market rate, with a 5-story base of office, retail and community uses.

“It’s a tough time to sell,” Kramer noted, “and perhaps a new buyer will need to return to the LPC with a revised design.”

The news comes amid the financial struggles of the Tin Building by Jean-Georges, a food hall opened in 2022. (Grub Street dubbed the fish market building conversion “a $200 million dollar flop.”) Nikodemus said the company plans to consolidate the specialty market and retail into “one better defined area” and “expand the bar seats throughout the building.” 

Seaport Entertainment also plans to build a 2-story glass enclosure over Pier 17’s rooftop concert venue, making the space a year-round destination. At the otherwise largely vacant pier, the company recently leased 75,000 square feet to Meow Wolf [5], an immersive entertainment venue.