Hello St. Paul’s, 
Two years ago we celebrated the grand opening of our new space in 525 Olive. We have since worked out most of the initial technical glitches and I believe that for the most part we are all comfortable with finding our way to and from the parking garage.
As you may know, it has been an adventure of over 20 years to get to this point, ever since Dean John Chane initiated the project of maximizing our land asset for the longterm benefit of St. Paul’s. Here’s a refresher of how we got here:
In 2004 St. Paul’s formed a wholly-owned subsidiary LLC, Nutmeg & Olive, and, with permission from the Bishop and diocesan Standing Committee, transferred ownership of the northern part of the cathedral’s block plus a parcel across Nutmeg Street to the LLC. This was so that it would be easier to negotiate terms with potential buyers, understanding that developers might shy away from a deal that would involve property held by the church in trust for the diocese (this is the norm for Episcopal church buildings).
Nutmeg & Olive has five managers: four are longtime members of St. Paul’s, elected for five year terms without term limits, and the fifth is the Dean. Commercial real estate deals typically take multiple years to finalize, and the longevity of managers has been a great advantage. Even so, after 20 years, Ken Tranbarger is the “last man standing” of the original managers, and the other managers, besides myself, are Betsey Monsell, Mark Lester, and Jim Greer.
In 2014 Nutmeg & Olive sold the parcel at Nutmeg and Fifth to a developer, with the proceeds allowing us to pay off the loan that had allowed us to buy that parcel and to invest the rest. After several false starts and economic ups and downs, we entered into a sale agreement with Greystar Inc in 2016. In 2019 we finalized the sale, and construction began. You might remember the giant hole that was dug (five stories down!) in the summer of 2019. Construction continued throughout the pandemic and was completed in June 2022.
The LLC owns approximately 6% of the 525 Olive property: most of the first floor, about half the second floor, and most of the first two floors of the parking garage. The LLC leases most of this property to the Cathedral, essentially for free. The 525 Olive company owns the land on which the Sixth Avenue Courtyard (or “Dean’s Courtyard”) is built, and we have an easement to use it in cooperation with the 525 Olive managers. An owner’s association is in place with three board members, one of whom represents the LLC. In addition to the space and the easements, we received cash and significant in-kind donations of improvements to the original Cathedral buildings from Greystar.
An unfinished portion of the first floor, facing Fifth Avenue, is reserved for income-producing commercial tenants, and we have been searching for a suitable tenant for about three years now. We have had several promising leads that didn’t come to fruition, so we are still looking. Once a tenant has signed a lease and finished out the space, the LLC will start to receive rent. The rental income from this space will essentially replace the income that the LLC used to receive from the old Park Chateau apartments and pass along to the Cathedral as operating income. In the meantime, the LLC is dipping into its resources to continue a significant and essential annual contribution to the Cathedral’s operating budget. In the long term, the LLC is committed to its original mission, which is expressed in a statement printed on all our materials: “The LLC has been called to the ministry of preservation, conservation and financial husbandry for the benefit of St Paul’s Cathedral well beyond our time.”
This has been a long journey, and I am beyond grateful to Ken Tranbarger for his leadership throughout all these years. Our other managers also give generously of their time and wisdom, and Russ Okihara serves as Chapter liaison, while Kathleen Burgess does a fantastic job as property manager and our liaison to the 525 Olive Association. I cannot end this historical summary without also mentioning our consultant Tom Delaney, who has been with the LLC from the beginning: Tom has guided us through the labyrinths of real estate deals and governmental bureaucracy, and we couldn’t have done this without him.
See you on Sunday!
Your sister in Christ,
Penny
