Selling Manhattan Trophy Properties for $100,000,000 + During the Pandemic

2/4/2021

As the New York City real estate market continues to adjust to the pandemic (and will continue for months to come), the multifamily industry has not come to a complete halt. Investors that believe New York City will bounce back are targeting trophy properties in prime locations across the city. Our team recently closed on two deals which fit that investment thesis: 169 Sullivan Street and 1 Christopher Street.

1 Christopher Street

Our team closed on 1 Christopher Street in the West Village for $95,000,000 in an all cash transaction, going from contract to close in nine days!.

1 Christopher Street is a 138-unit landmarked doorman building in the heart of the West Village. The family selling the asset not only built the building, but had managed and operated it since. The thought of selling never crossed the sellers’ mind until the 2019 rent laws went into effect and the pandemic hit. The seller had never experienced any vacancy in the building before 2020.  With those challenges and new regulations it was time to retire. 

The seller engaged New York Multifamily’s team to find the right buyer.  The timeline was tight! The seller wanted to ensure the building sold before the end of 2020 because he feared there would be tax changes in 2021 during a new president’s term. 

Through our vast network, we were able to uncover a family in Switzerland, who was looking for investments in New York City to purchase 1 Christopher Street.  Using a special visa required during the pandemic, they flew into town to tour the building.   From there, it was off to the races, signing the contract and closing nine days later. 

Our team commanded a 3.4% cap rate on this sale despite the market challenges and several transaction hurdles along the way.  For example, three days before the contract signing, the building’s gas was turned off. We were able to help create a future business plan for the buyer and keep the transaction on track.  The property closed right before the year ended.

169 Sullivan Street

169 Sullivan, in Greenwich Village, sells for $11,000,000.

169 Sullivan Street has been in the seller’s family for about 60 years. The seller originally planned to sell this building in 2023, but with the pandemic causing hardship for residential and retail tenants, she accelerated that timeline. She understood that although the multifamily market was uncertain, the building’s great location would be desirable for many buyers. 

The building consists of two retail units (leased to a restaurant and bar) and 18 apartments. It’s in the Greenwich Village neighborhood on the corner of Sullivan and Houston. The seller hired the NYM team to sell 169 Sullivan Street in March 2020.  We went to work finding the perfect buyer. 

The seller wanted to keep a low profile, so we used a targeted marketing approach and selected buyers who would be best for this property rather than casting a wide net. We were searching for buyers who would close quickly in the uncertain climate.  

Through our marketing and our vast network, we were able to create a bidding war. Our team was able to generate 17 written offers to ultimately get the highest price and best terms for the seller.  Even though times were turbulent, we were able to help the buyer look past the current situation in the city and look to the future of New York instead. 

We know the city and its energy will come back. It might not be tomorrow, but it will happen in the future. And when that does happen, this corner of Greenwich Village will be just as popular as before. 

The eventual buyer for 169 Sullivan Street was not the typical multifamily investor. He lives in the neighborhood and multiple parking garages in the city. Because this wasn’t an asset class he was familiar with, our team was able to help him secure financing in this challenging market and close on time. 

We achieved a cap rate just south of 4.9% at about $874 per square foot. 

Great Assets Will Always Move 

These sales prove that while todays market is uncertain, if you own a multifamily asset in a great location, you’ll still come out on top if you choose to sell today. Sellers need brokers who are hands-on every step of the way, not just when it comes to finding a buyer. 

Good brokers can predict landmines and easily negotiate the little challenges that come up during a sale, especially when it comes to the residential and retail vacancies that we’re facing in the city. Because of the current state of retail, brokers must be able to understand a building’s retail leases and be able to sell that to the buyer and to the bank to ensure the transaction closes. It’s not always just about the highest price today—it’s about execution. 

If you’re interested in buying or selling a building in a “trophy location,” email me today. 

Listen to our recent Podcast: Buying In Today’s NYC

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