This Week’s N.Y. Deal Sheet
Several big sales closed across the city this week as the seasonal push to close deals heats up, including a Downtown Brooklyn hotel and air rights for a storied Manhattan church.
TOP SALES
Citadel, Vornado and Rudin Management have agreed to pay $164M for the air rights above the landmarked St. Patrick’s Cathedral on Fifth Avenue, which they plan to use to construct a new supertall office tower, PincusCo reports. The developers closed on the agreement in January, according to Crain’s New York Business, but came to light because it needs approval from the New York attorney general, as the seller, The Trustees of Saint Patrick Cathedral, is a nonprofit. The trio is set to acquire 525K SF of air rights, but a smaller deal is also possible, at $98M for 315K SF, if the developers want to build a smaller tower.
CBRE brokered the deal with a 2% commission of the purchase price, while Fried, Frank, Harris, Shriver & Jacobson’s Jonathan Mechanic is representing the buyers. The developers reportedly want to build a 1.7M SF tower on a multiparcel site on Park Avenue, with the cathedral’s air rights at 631 Fifth Ave. incorporated into the proposed property.
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Blumenfeld Development has acquired two self-storage properties in Queens for $122M, Commercial Observer reported. The properties, located at 62-05 30th Ave. in Woodside and 34-09 College Point Blvd. in Flushing, sold for $50.6M and $72M, respectively. The seller was an Illinois-based developer, LSC Development, which paid $21M for the Woodside property in 2016 and $9.4M for the Flushing property a year later. The self-storage facilities were constructed in 2019 and 2021 and are both operated by Life Storage. Blumenfeld also nabbed an $84M loan from alternative lender Argentic to back the acquisition.
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Ohana Real Estate Investors, a California-based firm, has acquired a four-property portfolio from Chelsea-based real estate firm Tidal Real Estate Partners, Crain's reports. The sale price for the property was $110M and includes a 196-room Hilton hotel at 140 Schermerhorn St. in Brooklyn and three retail condominiums. The 19-story hotel was built in 2016, spans 130K SF and includes 128 residential condominium units with an address of 265 State St. The acquisition is Ohana’s second Downtown Brooklyn purchase in roughly a year. The firm also bought the 174-room Tillary Hotel at 85 Flatbush Ave. out of bankruptcy last December, The Real Deal reported.
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A six-story, 312-unit multifamily property in Rego Park, Queens, has sold for $48M, according to a release. The property, located at 99-19 66th Road and spanning an entire block, is a block from the 67th Avenue subway station and known as Fannwood Estates. The most recent owner was Fannwood Estates LLC, an entity linked to Ditmas Management, TRD reported. Both the buyer and seller were private investors, according to the release. Marcus & Millichap’s Shaun Riney, Seth Glasser, Joe Koicim, Louis Zarif and Sean Fopeano repped the seller and procured the buyer. Rents in the building are between $1,600 and $2,500, according to TRD.
TOP LEASES
Mitsui Fudosan America’s 1251 Sixth Ave. has signed financial adviser Solomon Partners to a 71K SF lease in the 54-story office tower, Commercial Observer reported. The 15-year lease will see the financial adviser take the entire 32nd floor and part of the 31st floor, replacing space it had been subleasing at 1345 Sixth Ave. from AllianceBernstein. The lease also represents an expansion of Solomon’s NYC footprint, adding 29K SF to the 42K SF it has been occupying six blocks north of 1251 Sixth. The company plans to relocate after its sublease ends next December, with the expansion intended to allow for new hires. Neil Goldmacher and Michael Horn of Newmark brokered the deal for Solomon, while the landlord was repped by Newmark’s David Falk and Peter Shimkin.
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The LeFrak Organization’s 40 W. 57th St. has signed five office leases totaling 104K SF, according to a release. Investment management firm Duquesne Capital Management has renewed its lease and expanded by 5K SF, taking the 25K SF 25th floor with representation from CBRE’s John Nugent and Craig Reicher. Silverpeak Real Estate Partners has also signed a 25K SF lease for the 29th floor, becoming a direct tenant after a period as a subtenant in the building, and was repped by CBRE’s Silvio Petriello. Access Industries, also previously a subtenant, took 25K SF on the floor below. International business and entertainment law firm Eisner LLP signed for 21K SF on the 20th floor as it expands and relocates from 152 W. 57th St. Dealpath also inked a deal in the building, taking 8K SF on the second floor as it relocates its headquarters from flex space on Sixth Avenue. CBRE’s Howard Fiddle, Gregg Rothkin, Benjamin Joseph, Evan Fiddle and Arkady Smolyansky led the team representing the landlord. LeFrak recently added amenities on the second floor of the 51-year-old tower where it is headquartered. The new leases follow two other major deals in the building this year: HPS Investment Partners’ renewal and expansion to 159K SF and Elliot Management Corp.’s expansion to 15K SF.
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Safe Horizon has signed a 20K SF lease at Quinlan Development Group LLC’s Pioneer Building at 41 Flatbush Ave. in Brooklyn, according to a release. The nonprofit, founded in 1978, will take part of the sixth floor of the 10-story, 270K SF property. The building underwent capital improvements and has a new lobby, a renovated facade, new windows and a landscaped rooftop. Jason Kroeger and Frank Liantonio of Cushman & Wakefield repped the tenant.
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SJP Properties’ 470 Park Ave. S, which it developed with partner PGIM Real Estate, has signed architecture, design and strategy firm Nelson Worldwide to 10K SF, according to a release. The firm is relocating from 22 W. 19th St. as it anticipates growth, and it will take up the entire seventh floor of the 18-story office tower a few blocks from Madison Square Park. The lease runs until 2030.
TOP FINANCING DEALS
Lightstone Group has scored a $166M loan from JLL Real Estate Capital to refinance a residential property in Brooklyn’s Gowanus neighborhood, PincusCo reported. The property, a 429-unit residential building at 365 Bond St., also has affordable units and used the 421-a tax abatement. Lightstone purchased the property in 2013 and debuted its market-rate rentals in 2016 — although the sale resulted in a lawsuit when sons of the previous owner alleged that appraisals undervalued the property at the time of sale, The Real Deal previously reported.
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Naftali Group nabbed $236M in construction financing from JPMorgan Chase and Starwood Capital for an upcoming luxury residential development on the Upper East Side. Construction on the property, located at 255 E. 77th St., is underway, and sales for some of its 62 condominium units are expected to start in 2024. The development is the continuation of Naftali Group’s bet on luxury condo developments, having sold out three luxury buildings in Manhattan since 2020: The Benson at 1045 Madison Ave., 200 E. 83rd and The Bellemont at 1165 Madison Ave.
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Carthage Real Estate Advisors scored a $100M bridge loan from Dwight Mortgage Trust for a newly constructed Harlem multifamily property, Commercial Observer reported. The 19-story building at 224 W. 124th St. was completed this summer and has 168 units, including 51 affordable apartments, thanks to the now-expired 421-a tax break. The sum replaces a construction loan for the property and provides extra capital.
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Canadian lender Otera Capital has agreed to loan $93M to a joint venture of Alexander Development Group, The Bluestone Organization and institutional investors advised by J.P. Morgan Asset Management for a luxury residential property in Mount Vernon, according to a release. The 16-story property will bring 249 units to the Westchester County town and will also feature 20K SF of amenities. The property, located at 42 W. Broad St., is also being built to Passive House standards. A JLL debt advisory team led by Kellogg Gaines and Geoff Goldstein brokered the financing.
