NEW YORK CITY—Real estate heir and former Gov. Eliot Spitzer reportedly has placed a large, valuable portfolio of apartments owned by his family on the block. Now up for grabs is a batch of 144 apartments at the Corinthian—a luxury building at 330 E. 38th St.—that could be worth $145 million or more, according to Crain's New York Business.
Robert Knakal, chairman of Massey Knakal Realty Services, is marketing the apartments. Prospective buyers would do well from this investment, he tells GlobeSt.com. “This is a very rare asset; normally these blocks of apartments either are vacant and new or they're occupied and full of rent regulations.
“This block is fully rented with free market tenants,” he notes, “so the cash flow is very strong. You can buy and get the same type of holding return as you would from an apartment house because they're free market apartments and you don't have to wait to sell off the units, an owner can just not renew leases and sell as they see fit. Also, 110 of the units have been renovated in the last few years, so they are in great shape.”
The 57-story building is said to be one of Manhattan's largest residential towers, with 863 units, and a columnar facade that provides the apartments inside with curving bay windows that offer sweeping views of midtown, says Crain's. The Spitzers sold most of those apartments in the years just after they constructed the tower, but when the city's sales market slowed by the late 1980s, they decided to hold on to 144 units and convert them to rental properties. The family has held onto the apartments—which are scattered throughout the tower—ever since.
Having lost a tightly-fought bid for city comptroller last year and with his father in his 80s and in poor health, the deal is also a sign that the younger Spitzer has begun to take a more active hand in steering the family's real estate business. In December, he acquired a prime development site in the Hudson Yards for $88 million.
The sale of the Corinthian apartments could be a way for Spitzer to raise capital for future acquisitions or help finance the purchases he has made.
“Eliot is very sensitive to the fact that the family has extracted as much value as it can from some of the assets it owns,” Jeffrey Moerdler, a real estate attorney with Mintz Levin, who is a friend of Spitzer's and handles the legal work for many of his real estate transactions, including this current sales effort, told Crain's. “He's trying to monetize those buildings and reinvest in assets that have the opportunity to generate new value.”
There are opportunities to increase the value of the units, Knakal notes in Crain's. Some are contiguous, which means they can be combined into larger, more valuable apartments. About a quarter are also in need of renovation and could be redone and sold or rented at a profit.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
