Big MXD Investment Sale Made in Queens

Saxon Hall in Rego Park , Queens features 419 rental units.

NEW YORK CITY—A partnership of Madison Realty Capital and Arel Capital has acquired the Saxon Hall mixed-use building in the Rego Park section of Queens. The 419-unit property was sold by Treetop Development—a Teaneck, NJ-based firm—for nearly $136 million, making the transaction one of the largest investment sales deals this year in the borough. Located at 62-60 99th St., the 503,000-square-foot building includes 3,842 square feet of commercial space and a parking garage with more than 200 parking spaces. Treetop reportedly paid approximately $85.3 million two years ago for the property and was at one time looking to sell the asset for about $150 million. Steven Vegh of Westwood Capital brokered the transaction. An Eastdil Secured team of Adam Doneger, Adam Spies,  Jean Celestin and Dan O’Brien arranged Arel Capital’s equity investment in the property. Meridian Capital advised on the financing. Madison Realty Capital plans to undertake what it describes as a comprehensive capital improvement program for the property, including renovating and reconfiguring residential units, improving operating efficiencies and curb appeal, as well as enhancing and expanding the amenity package. The company did not disclose the estimated cost for the planned capital improvements. “Our acquisition of Saxon Hall illustrates our ability to utilize local market knowledge to identify attractive investment opportunities in emerging neighborhoods,” says Josh Zegen, co-founder and managing principal of MRC. “Rising rents in other city submarkets have increased the appeal of Rego Park over the last few years.” “Saxon Hall is a unique property with great long-term potential, and we seized the opportunity to acquire it when the investment became available,” he notes. The company has served as lender on other properties in the Rego Park area, including the Millennium 99 and Tuhsur Development’s condominium project. The residential unit mix of Saxon Hall includes one-, two- and three-bedroom units, as well as a large penthouse apartment. The commercial space consists of two office suites on the ground floor, currently occupied by medical office tenants. The existing amenity package offers storage space, two large laundry rooms, bicycle storage, a pet spa, a fitness center and a playground. In May, Madison Realty Capital closed its Madison Realty Capital Debt Fund III LP , the firm’s third institutional real estate debt investment vehicle. The discretionary private equity fund raised a total of $695 million in capital commitments. In February of this year , Treetop Development expanded its holdings in Queens with the purchase of an eight-building, 608-unit multifamily portfolio located in the Flushing and Elmhurst areas of Queens.