(To read more on the multifamily market, click here.)
NEW YORK CITY-The Westport Group Inc. is acquiring and redeveloping 650 Sixth Ave., a six-story loft building located at West 20th Street in the Chelsea/Flatiron District. It marks Westport's first foray into the New York City condominium conversion market.
Westport's redevelopment plan includes releasing and repositioning the retail section, adding a seventh-floor penthouse level as well as converting floors two through six to loft-style residential condominiums. The project is expected to be completed by late 2006.
Westport Group is a private real estate investment firm headed by Klaus Kretschmann, formerly of GIC Real Estate and Lazard Freres, and Annemarie Kretschmann. Founded in 1992, Westport concentrates on three interconnected areas of development: planning, construction and marketing. Previous projects have included the US headquarters of the Melville Corp. in Rye, NY and a number of apartment rehabs in Greenwich Village. In total, the principals have been involved in the acquisition, development and operation of more than $10 billion in multifamily and commercial assets. Company officials say they offer a kind of "one-stop shopping that demystifies the development process" taking away the frustration of dealing with different parties at different stages.
Sonnenblick-Goldman served as exclusive advisor to Westport. The firm arranged a $95-million, non-recourse loan for the acquisition and redevelopment. "The substantial growth in demand for well-located Chelsea condominiums creates heated competition for buildings like 650 Sixth Avenue," notes Rick Swartz, managing director and principal of Sonnenblick. He says its "quite rare to find an asset that can offer such a prime corner location, with protected light and air, high-ceilings and the potential for exceptional outdoor space."
The transaction was closed on an expedited schedule to meet the stringent demands of Westport's contract. The loan was funded by Bear Stearns Commercial Mortgage Inc., Alex Hernandez, vice president of Sonnenblick says this transaction reaffirms the trend of major Wall Street capital providers competing for market share in this high-margin sector of the lending market."
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