NEW YORK CITY—After a long wait, plans for the Upper East Side site of a New York Sports Club that was purchased late last year have been revealed.
Located on the Northeast corner of East 86th street—a key commerce street in the area—the new development at 147 and 151 E. 86th St. (which will be renamed 147 E. 86th St.) will include 50 luxury condominiums, 30,000 square feet of retail space, a New York Sports Club and 10,000 square feet of residential amenity space, according to the Commercial Observer.
The new $340 million, 230,000-square-foot development, which will feature a 24,000-square-feet NYSC gym that will occupy the space in a sale-leaseback, is slated to take 30 months to build following demolition of the two existing buildings, which is set to take place in about nine months.
Ceruzzi Properties, Stillman Development International and Kuafu Properties acquired the two buildings, plus air rights through a series of complex deals, the Observer states. The new property's retail space—for which asking rent is $10 million annually—is being marketed by Andrew Mandell,managing partner, Ripco Real Estate Corp.
“We're looking to have a spot for a world-class retailer on a very important corner in New York City,” says Lou Ceruzzi of Ceruzzi Properties. “I expect that the retail component of our transaction will have one or more retailers on the first floor and at least one of the retailers will merchandise out of the lower-level space also.”
“That could be the best residential corner in the entire United States because it sits in what I would argue is the densest residential population in the United States, in terms of a neighborhood,” adds Mandell. “It sits on top of one of the busiest subways in the New York subway system.”
In December 2013, the developers got a just over $33 million, 99-year ground-lease from the heirs of Sol Goldman at 147 E. 86th Street, the Observer reports. The group then bought 151 E. 86th Street from Town Sports International Holdings, the owner and operator of gym chain New York Sports Clubs, for nearly $86 million in Sept. 2014.
Simultaneously, the health club leased the entire property, paying $750,000 annually. That rent will increase to $1.7 million per year in the new building, says Ceruzzi. This March the developer group also purchased 19,315 square feet of development rights from 1283-1291 Lexington Ave. for just over $12 million, along with 6,535 square feet of “footprint rights” for nearly $2 million. It is in the process of buying inclusionary rights.
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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.
