NYM Team Brings New Capital to LES with $61,500,000 Sale
Bronx Landlord Makes First LES Purchase for $61,500,000
To be a successful seller in this market you need the right broker, using the right process, who provides accurate pricing guidance. For example consider our recent sale of a building called the Jones l.e.s. This story is timely given today’s phase of the real estate cycle. In a flat market, investors cannot make mistakes. That is why you work with a specialist.
THE BACKGROUND & OBJECTIVE
After acquiring land and developing the property, ownership of the Jones l.e.s wanted to take advantage of the current market to profit on their venture. Being a new 421-a building with market rents, low taxes, and little left for “value add”, finding the right buyer was not going to be an easy task.
“Peter, Joe, and the rest of their team proved to be the experts in their space as advertised. They were competent, professional, and sold the building in the price range they promised. I would describe it as true value added brokerage.”
– Jon, former owner of Jones l.e.s
The property had two big challenges. The first was that the property was in pristine condition with market rate rents. Many buyers prefer properties in which they can find or create additional value through rental upside.
Challenge number two was the 20-year 421-a tax abatement. With this tax abatement program, the new owner does not know what the phased-in taxes will be at the expiration, providing a degree of risk that could make a purchase decision difficult.
The seller chose our team because of our mid-market specialization, ability to reach both private and smaller institutional capital sources, and geographic focus. With some creative marketing to address the concerns about value and the 421-a, we were able to find a buyer in a 1031 exchange.
More importantly, we were able to bring someone new to the table: a buyer who had never purchased on the Lower East Side. Our team and extensive network specializes in bringing new capital to opportunities. When the left hand knows what the right hand is doing, as is the case with the NYM team, it is not difficult to create a market of competitive bidders. Our buyer closed the sale for $61.5 million, slightly lower than our asking price of $65 million.
If you are interested in learning how you can be our next success story, or are interested in the potential value of your asset, contact me to discuss.
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