The Empire State Development Corporation (ESDC) has approved a sweeping redevelopment plan for 5 Times Square, authorizing the conversion of the midtown office tower into approximately 1,250 residential units, officials said on Tuesday, in one of the most high-profile commercial-to-residential conversions since the pandemic-era office exodus.
The plan, backed by a private development consortium led by RXR Realty and Wafra Capital Partners, aims to transform the 1.1 million-square-foot former Ernst & Young headquarters into a mixed-use property featuring both market-rate and affordable housing. Located at the corner of Seventh Avenue and West 42nd Street, the building sits at the epicenter of Manhattan’s theater district and commuter hubs.
“This project is a milestone in our efforts to adapt outdated commercial stock to meet urgent residential demand,” said Hope Knight, president and CEO of the ESDC. “By repurposing underutilized office buildings, we can revitalize Midtown and address the city’s persistent housing shortage.”
➤ A blueprint for Midtown’s evolution
Originally completed in 2002, 5 Times Square stood as a gleaming symbol of Midtown’s corporate resurgence in the post-9/11 era. But after anchor tenant Ernst & Young vacated the premises in 2017, the building has struggled with high vacancy rates amid broader shifts in the post-pandemic work landscape.
Under the approved plan, developers will reconfigure upper floors into residential apartments, while the lower levels will retain commercial retail and community spaces. According to city officials, roughly 20% of the new units will be designated as affordable housing, though final income thresholds have not yet been announced.
Construction is expected to begin in early 2026, with initial occupancy projected for late 2028.
➤ Public–private model gains traction
The redevelopment was approved under New York State’s Office Conversion Accelerator Program, part of Governor Kathy Hochul’s broader strategy to address the city’s deepening housing affordability crisis. According to city data, Manhattan’s rental vacancy rate fell below 2.5% in early 2025, while average rents reached record highs, particularly in transit-rich areas.
RXR CEO Scott Rechler called the project “a transformative model” for how the city can adapt to a hybrid workforce. “Buildings like 5 Times Square were built for a very different era. This conversion allows us to preserve value, reinvest in the neighborhood, and house thousands of New Yorkers,” he said.
The plan is one of over a dozen similar conversion efforts being considered across Midtown Manhattan and Lower Manhattan, where aging commercial buildings are increasingly seen as opportunities to meet the city’s ambitious housing targets.
➤ Pushback and infrastructure concerns
Not all stakeholders are on board. Community board members and tenant advocates have raised concerns about transit congestion, school overcrowding, and the strain on existing services.
“This is a bold proposal, but we need transparency on affordability and infrastructure investments,” said Christine Martino, a housing advocate in Midtown West.
Despite these concerns, the city’s Department of City Planning said the 5 Times Square redevelopment aligns with long-term goals to create 500,000 new housing units citywide over the next decade.
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