NEW YORK CITY-The Carlton Group has announced that its chairman, Howard Michaels, has organized an equity partnership between hotelier Ian Schrager, a real estate developer and brokerage firm to form a joint venture to buy an equity stake in 156-162 Leroy St., along with the adjacent corner parcel, 357-363 West St. The asset is owned by AREA Property Partners, which last month announced it would be acquired by Los Angeles-based Ares Management.

Schrager's partners on the deal are Howard Lorber, chairman of residential brokerage company Douglas Elliman and head of the Vector Group; and Steven Witkoff, a developer and head of the Witkoff Group, which owns 20 buildings—including the famed Woolworth Building in Lower Manhattan. Schrager is best known as the co-owner and co-founder of Studio 54. He went on to create buzz-worthy boutique hotels.

Carlton also arranged senior debt financing for the project from a non-New York balance sheet lender, which Carlton says in the press release is, “particularly artful given that the property is land and still has to receive a residential zoning variance.” Michaels, who specializes in putting together equity partnerships and highly leveraged multi-tranched debt solutions, put the same trio of buyers together last year when the group acquired a major development site (with Ziel Feldman) on Chrystie Street to build a new Schrager branded condominium and hotel. Michaels also has put together one other large Manhattan hospitality transaction with Schrager, Witkoff and Lorber, which is slated to be announced soon.