NEW YORK CITY—Dalan Management and RWN Real Estate Partners have purchased the 99-year ground lease for the Indigo—located at 230 E. 44th St.—for $47 million. The seller is a partnership of Atlantic Realty Group, Moezinia Bros. Capital and 230 MD Member.
M&T Bank provided a $36.2 million acquisition and renovation loan—brought in by HKS Capital Partners—and Daniel Rahmani of Venture Capital Properties brokered the deal. The 14-story, 135,315 square-foot, mixed-use building features 164 residential apartments, a 25,000 square foot parking garage and 3,700 square feet of retail space that's fully occupied by a restaurant and a nail salon.
The building is on a ground lease and the joint venture buyers acquired the leasehold interest in the property. The lease originally had 14 years remaining before a fair market rent reset was to take effect. The buyer was able to sign a “soft contract” during which time it restructured the ground lease to a brand new 99-year-term with contractual rent, no fair market rent resets and other improved terms.
Dalan and RWN plan to conduct a comprehensive rehabilitation and repositioning program to update apartment finishes, renovate the lobby and common areas and add modern amenities to the property. With three new ground up, high-rise developments under way on the same block, along with the building's close proximity to Grand Central Station and the United Nations, the redevelopment reportedly is well situated to take advantage of the city's strong multifamily market.
“We are extremely pleased that we were able to fully renegotiate and extend the ground lease in a manner that makes the planned redevelopment of the property economically attractive to Dalan and RWN,” says Ari Shalam, managing principal of RWN.
Adds Daniel Wrublin, founding principal of Dalan, "We are excited to acquire a substantial asset centrally located in the middle of Manhattan. We plan to modernize and improve the property to make it a desirable place for residents to live for years to come."
Dalan and RWN have acquired approximately $150 million in property together over the past two years. This asset purchase comes on the heels of Dalan's recent $36 million purchase of 10-12 East 33rd Street in Manhattan from Adee Associates earlier this month.
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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.
