A GVA source tells GlobeSt.com that the seller of the 25th Street property was the Lasser Family, who owned the building for 50 years. The source says that the buyer was a real estate partnership, which consists of a group of entrepreneurs.
[IMGCAP(2)]The new owners have planed major renovations to the building that they believe will help nearly double asking rents from the mid $20s to $40s per sf. Within the next 12 months, a number of leases will expire, freeing up 50,000 sf to 60,000 sf to lease at the higher rents.
"This was a great investment because leases are rolling in this building, making a renovation possible," notes Marty Meyer, senior executive managing director at GVA Williams. "The renovation will make the building more desirable to a wider range of potential tenants and justify a significant increase in asking rents."
[IMGCAP(3)]Eric and Marty Meyer represented both the owner and the seller and are the exclusive leasing agents for the building. The class B building, located between Sixth and Seventh avenues contains a total of 90,000 sf on 12 stories. It was built in 1912.
The Meyers also arranged the sale of 35 W. 36th St. for $28 million, or $486 per sf, to 3526 Associates LLC, a locally based investor. Douglaston Equities LLC was the previous owner. The building was sold just one year earlier for $19 million.
"The current sale price of nearly one-third more than the price paid just a year ago shows the incredible strength of the investment sales market in Manhattan," says Eric Meyer, senior managing director at GVA Williams. Built in 1911, the Penn Plaza District property totals 57,636 sf and is 100% leased to 15 tenants. The transaction represents a 3% cap rate. Eric and Marty Meyer of GVA Williams represented both parties.
With leases rolling within the next two years, the new owner plans to renovate the building with a new lobby, elevators, installation of tenant controlled central air, upgraded security systems and electronic tenant directory. The renovations are expected to generate asking rents in the $40s per sf, up from the $20s currently.
The source explains that both buildings were seen by the buyers as a good opportunity in terms of short-term leases and both sellers chose to capitalize on potential profits. The seller for 25th Street was out of state and knew investment needed to be made in the property, but didn't want to be involved with a "long distance" renovation.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
