Work has begun on one of Midtown’s most closely watched real-estate experiments: turning a fully vacant Times Square office tower into housing. RXR Realty, SL Green Realty and Apollo Global Management have started the conversion of 5 Times Square, a roughly 38-story tower, into about 1,250 rental apartments — 313 of them permanently affordable.

A vacant tower finds a second life

5 Times Square was built around 2002 as the home of accounting giant EY (Ernst & Young). When that lease wound down, the developers were left with hundreds of thousands of square feet of empty Class-A office space in a market where Midtown office vacancy has stayed stubbornly high since the pandemic.

Rather than chase new office tenants, the ownership group moved to convert roughly 917,000 square feet of vacant office floors into 1,250 units, with Gensler as architect. Early site work has been visible from the street: crews began assembling a construction hoist on the building’s south face and removed a strip of the glass curtain wall to start the interior gut.

Why the timing matters: 467-m

The economics turn on a state tax program. RPTL Section 467-m — the Affordable Housing from Commercial Conversions incentive — was enacted by Albany in 2024 to push owners of obsolete office buildings toward housing. The program offers a tiered property-tax exemption: projects that start construction before June 30, 2026 can claim a 90% exemption for 35 years, with smaller benefits for projects begun later.

The catch is affordability. To qualify, a converted building must set aside a share of units as permanently affordable. At 5 Times Square, that obligation takes the form of the 313 income-restricted apartments, affordable to households earning up to 80% of area median income. The June 2026 start deadline is the reason the project broke ground when it did.

The money

The partners have layered substantial financing onto the deal. Per reporting in The Real Deal and Commercial Observer, RXR, Apollo and SL Green secured roughly $575 million toward the conversion in mid-2025, including a large senior loan tied to the partial conversion. The same investor circle — RXR and Apollo, with JP Morgan — has been active across Manhattan’s conversion wave, including a separate financing to convert 61 Broadway downtown.

Part of a larger wave

5 Times Square is one of the marquee names in a conversion boom that brokers expect to roughly double in 2026. The largest completed project remains 25 Water Street in the Financial District, where GFP Real Estate, Metro Loft Management and Rockwood Capital delivered about 1,320 apartments — the biggest office-to-residential conversion in U.S. history to date. The New York City Comptroller’s office has estimated that the first wave of conversions could create more than 17,000 homes citywide.

The developers have said they are aiming for first-phase completion at 5 Times Square in 2027.

Verification

Frequently Asked Questions

Who is converting 5 Times Square and into what?
RXR Realty, SL Green Realty and Apollo Global Management are converting the roughly 38-story, formerly EY-anchored office tower at 5 Times Square into about 1,250 rental apartments, designed by Gensler. Of those, 313 are slated to be permanently affordable to households earning up to 80% of area median income.
What is the 467-m tax program?
RPTL 467-m, the Affordable Housing from Commercial Conversions incentive enacted by the state in 2024, gives a property-tax exemption to office-to-residential conversions that set aside affordable units. Projects that begin construction before June 30, 2026 qualify for the richest tier — a 90% exemption for 35 years — in exchange for the affordability requirement.
When will people move in?
The developers have targeted first-phase completion in 2027. Construction began in late 2025/early 2026; crews started assembling a construction hoist and removing sections of the glass curtain wall to begin the interior overhaul.
Is this the biggest office conversion in the city?
No. The largest completed conversion is 25 Water Street downtown — about 1,320 units delivered by GFP Real Estate, Metro Loft and Rockwood Capital. 5 Times Square is among the largest now under construction.