Properties Sold

121 East 23rd Street

East 23rd

The property is located at 121 East 23rd Street between Park Avenue South and Lexington Avenues in the Gramercy Section of Manhattan. At the time of acquisition, it consisted of two single-story retail stores and a five-story loft building with two retail stores on the ground floor. All of the tenants were vacated by February 7, 2003 and demolition began in April 2003.

The acquisition was structured as a net lease with an option to acquire the property at a predetermined price. Both the ground floor space as well as the residential apartments were converted to condominium ownership. When the purchase option was exercised, the previous owner retained ownership of the stores, as a separate commercial condominium.

The original plan for this property involved construction of a 14-1/2-story building, consisting of approximately 55 residential condominium apartments and four stores. However, it was determined that the addition of square footage to the project, through the purchase of air rights, would enable us to transform the property into a luxury 21-story, ninety-five unit building with four stores. These air rights would be added to the new building’s highest and most valuable floors resulting in a significant decrease to the effective acquisition, development and operating costs per square foot of the property.

Through sheer persistence, and months of negotiations, a deal was finally made to acquire the additional air rights. As a result, the gross square footage of the property increased from 61,600 to approximately 116,701 square feet (including a full basement). More importantly, the property’s sellable square footage increased from approximately 49,000 to 87,331 square feet, substantially increasing the profit potential of the property.

All 95 condominium units have been sold for an aggregate sales price in excess of $90,000,000. The Investors Internal Rate of Return on this investment was in excess of 30%.

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Contact Info

Rolling Cash Equity Group
1430 Broadway - 14th floor
New York, N.Y. 10018
Tel: 646-519-8490
Fax: 646-519-8494