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A blog for breaking sales and neighborhood real estate news.

By, Edward Gevinski, Massey Knakal Realty Services

As Mayor Bill de Blasio has settled into office, his plan to increase the volume of affordable housing in New York City is gaining more and more traction. It was announced recently that a major portion of Brooklyn’s East New York neighborhood will be rezoned to promote new housing projects. The details of the rezoning are unclear at this point, however, the Mayor plans to develop 200,000 affordable housing units within the next ten years.

According to the city planning report, the bulk of the East New York rezoning will occur within a 25-block span of Atlantic Avenue between Pennsylvania Avenue to the east and Euclid Avenue to the west. This area is particularly desirable for new developments due to its accessibility to public transportation.

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Neighborhoods: East New York

By, Thomas A. Donovan, Massey Knakal Realty Services

Transformation is under way in the Queens neighborhood of Ridgewood.  As young professionals continue to get priced out of nearby areas they are rediscovering Ridgewood as a more economical alternative.  This uptick in demand for housing in this supply constrained market is leading to rising rents and higher per unit sale prices for multifamily investors.

Much of the neighborhood’s well-maintained housing stock consists of higher density, brick six-family buildings located near the Ridgewood-Bushwick border and lower density homes located deeper into Queens.  Recently, the NYC Landmarks Preservation Commission unanimously approved the designation of the Central Ridgewood Historic District, which comprises 990 buildings, consisting mostly of brick row houses. This new district represents one of the most harmonious and architecturally-notable enclaves of working-class dwellings built in New York City during the early twentieth century.

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Neighborhoods: Ridgewood

Queens is well on track to reach an all-time high in dollar volume.  During the first three quarters of 2014, dollar volume was $2.6 billion, which exceeds 2013's entire year total. In annualized terms, Queens is on track to reach a dollar volume of $3.5B in 2014, almost $1B more than the previous high of 2006. Price per square foot was $297 during the first three quarters of 2014, up 5% from 2013's annual average.

Ridgewood is on track to become the most active neighborhood in terms of number of buildings sold in Queens.  The average price per square foot in Ridgewood was $198 in the first three quarters of 2014, significantly lower than the other top investment markets like Astoria, Long Island City, Flushing, and Sunnyside, which all have prices per square foot north of $300.

Neighborhoods: Ridgewood

A hotel development site at 710 Third Avenue, located between East 44th and East 45th Streets in Manhattan’s Midtown East neighborhood, was sold in an all-cash transaction valued at $17,400,000.

Located in a C5-3/MiD zone, the approximately 25’ x 95’ site allows for a maximum of approximately 35,625 buildable square feet, based on the 15.0 FAR.  The property was delivered vacant, and the sale price equates to approximately $488 per buildable square foot.

The site offers convenient access to Grand Central Terminal, the United Nations, and Times Square and is surrounded by shopping, corporate headquarters and landmarks.

“This purchase was made by an out of town buyer getting started in New York City, so the location near Grand Central and the deal size made this an ideal choice for them,” said Massey Knakal’s Clint Olsen, who exclusively represented the seller in this transaction.  The buyer was represented by Limor Nesher of Core.

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Neighborhoods: Midtown East

A mixed-use building at 754 Grand Street, located between Graham Avenue and Humboldt Street in Brooklyn’s Williamsburg neighborhood, was sold in an all-cash transaction valued at $4,350,000.

The four-story, brick building contains approximately 5,840 square feet and sits on a 24.33’ x 100’ lot. It consists of six vacant residential units and one retail unit. The residential units are in need of renovations and the building possesses approximately 4,000 square feet of additional air rights. Furthermore, a developer can take advantage of the ICAP, J-51 or 421a tax exemption programs. The sale price equates to approximately $745 per square foot.

The building is just two blocks away from the Grand Street L train station, which provides direct access to Manhattan.

“Grand Street is seeing great growth in popularity and this property was well suited to take advantage of this momentum. The price realized is the highest paid on Grand Street for any building under 30’ wide, by 25% more than the next highest sale,” said Massey Knakal’s Brendan Maddigan, who exclusively represented the seller in this transaction. The buyer was represented by Matt Fernandez of Town Real Estate.

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Neighborhoods: Williamsburg/ Agents: Brendan Maddigan

A mixed-use building at 7 West 24th Street, located between Sixth Avenue and Broadway in Manhattan’s Flatiron District, was sold in an all-cash transaction valued at $9,500,000.
The property’s lot totals approximately 2,370 square feet and features 24’ of frontage.  Based on the C5-2 zoning and 10.0 FAR, the site can be developed into approximately 23,700 square feet for various uses including residential, hotel, office, retail, community facility, or mixed-use.  Currently, the site is improved by a five-story mixed-use building that totals approximately 9,282 square feet, with five residential units and a ground floor commercial unit with a long-term lease in place. The sale price equates to approximately $1,023 per existing square foot, an in-place 3.29% capitalization rate and 21.35 times gross rent roll. As a development site the price equates to approximately $401 per buildable square foot. 

The property is located less than one block west of Madison Square Park, adjacent to the new high-end conversion at 10 Madison Square West. The Flatiron District has seen a surge in neighborhood improvements and recent developments, making it one of the most desired areas to live and work in the city.  It offers convenient access to almost every subway line as well as the city’s major employment centers including Midtown South
The property was purchased by Mark Geragos, a prominent trial attorney whose client list has included Michael Jackson, Mike Tyson, Chris Brown, and Sean Combs.  Geragos is also a legal analyst on CNN’s Anderson Cooper 360, where he comments on high profile legal cases.  Geragos has always had a passion for real estate, and in particular, for buildings which are historically significant.  Since a young age, he has bought and sold hundreds of properties throughout California and has recently broadened his real estate portfolio to include investments in New York.  Earlier this year, Geragos purchased 107 Greenwich Avenue in the Greenwich Village neighborhood. In 2012, he purchased 256 Fifth Avenue as the New York offices of his Los Angeles-based law firm, Geragos & Geragos. 
Attorney Tina Glandian, Geragos's longtime partner, represented Geragos as the broker in the transaction.  The attorney for the seller was Larry Haber of Abrams Garfinkel Margolis Bergson, LLP and the attorney for the buyer was Yelena Nersesyan of Busson & Sikorski.
“This transaction exemplifies how deep the current buyer pool is for investment properties in New York City. After months of marketing, targeting and negotiating with developers for this site, the eventual purchaser saw it as a solid long-term investment opportunity with an eventual exit strategy of redevelopment. Every day we’re meeting new buyers, foreign buyers and first time buyers searching for wealth preservation,” said Massey Knakal Chairman Bob Knakal, who exclusively represented the seller in this transaction with Vice Chairman John Ciraulo.  

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Neighborhoods: Financial District/ Agents: John Ciraulo

A mixed-use building at 963 First Avenue (aka 350 East 53rd Street), located on the corner of East 53rd Street and First Avenue in Manhattan’s Midtown East neighborhood, was sold in an all-cash transaction valued at $10,395,000.

The five-story building contains approximately 11,607 square feet on a 25.42’ x 100’ lot, with a ground floor retail space and 15 apartments above.  The unit mix consists of one two-bedroom, seven one-bedroom, and seven studios, with five rent stabilized and ten free market units.  The sale price equates to approximately $896 per square foot.

The property is zoned R10 with a C1-5 overlay but the air rights were sold to the Toll Brothers mixed-use development site located adjacent to the property.  Construction is in progress and will create significant value on the block.  Additionally, the property benefits from ongoing development in the neighborhood and the incoming Second Avenue subway.

“The buyer is going to make significant changes to the building and its unit layouts as they look to capitalize on the upswing in rents due to the resurgence of Midtown East and the Second Avenue corridor,” said Massey Knakal’s Clint Olsen, who exclusively handled this transaction.

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Neighborhoods: Midtown East

Massey Knakal Realty Services has been retained on an exclusive basis to sell a development site at 30-55 Vernon Boulevard. The property is located between 30th Road and 30th Drive in the Astoria neighborhood of Queens. Ownership is requesting proposals.

The development site consists of four tax lots which combine for approximately 140,665 buildable square feet on a 37,116 square foot irregular lot. The site currently holds a commercial structure, measuring approximately 24,000 square feet. There are preliminary plans for approximately 220,000 buildable square feet with a rezoning.

Situated amongst several planned and recently completed developments on the Astoria waterfront, the site’s prime location makes an excellent opportunity for a developer looking to capitalize on the explosive growth of the neighborhood.

“This area is quickly emerging and the site holds immediate value with its waterfront location along with the benefit of several local mega-projects underway,” said Massey Knakal’s Stephen R. Preuss, who is exclusively marketing this property with David Chkheidze. “This site presents a great opportunity to build a mixed-use property in the vibrant neighborhood of Long Island City,” added Chkheidze.

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Neighborhoods: Astoria/ Agents: Stephen Preuss

The Palace Portfolio, consisting of five apartment buildings at 633, 636, 642, 643, and 650 West 173rd Street, was sold in an all-cash transaction valued at $30,000,000. The properties are located between Broadway and Fort Washington Avenue just north of Columbia Presbyterian Hospital in Manhattan’s Washington Heights neighborhood.

The five walk-up buildings total 146 residential units and approximately 120,000 square feet.  Of the 146 units, 133 are rent stabilized, two are rent controlled, eight are free market, and three are reserved for supers.  The unit mix consists of 45 one-bedroom, 81 two-bedroom, 19 three-bedroom, and one four-bedroom apartment.  The sale price equates to approximately $250 per square foot.

The properties are well-maintained and have undergone exterior building renovations including painting, landscaping, and masonry work on the entry walkways.  Many of the properties have undergone numerous major capital improvements including conversion to gas boilers and burners, roof renovations, pointing, new windows, and wiring. 

“Bidding on these assets was highly competitive due to the tremendous upside in rents, superior west of Broadway locations and ability for an owner to purchase 146 units in one shot,” said Massey Knakal’s Robert M. Shapiro, who exclusively handled this transaction with Thomas A. Donovan.

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Neighborhoods: Washington Heights/ Agents: Robert Shapiro

Massey Knakal Realty Services has been retained on an exclusive basis to sell a hotel development opportunity at 39-35 27th Street, located between 39th and 40th Avenues in the Dutch Kills neighborhood of Long Island City, Queens.  Ownership is requesting offers.

Construction of the hotel is approximately one-third complete and upon conclusion, it will total 38,000 square feet and 79 guest rooms.  Given the current progress, investors will benefit from a shortened development timeline and the well-developed business plan of the seller, an experienced local hotel developer and operator.

“The offering presents a unique opportunity to acquire a full or partial interest in a hotel in the construction phase, in one of the most rapidly developing hotel markets in the New York metro area,” said Massey Knakal’s Andrew Posil, Director of Sales, Hospitality, who is exclusively marketing this property with Chairman Bob Knakal and David Chkheidze.

The site’s location offers close proximity to the subway providing easy access to Manhattan as well as a growing number of local amenities.  

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Neighborhoods: Long Island City

Massey Knakal's Seth Pollack was recently named to Real Estate Forum's Top New Jersey Brokers list.

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Neighborhoods: Bergen County, Passaic County/ Agents: Seth Pollack

A development site at 264 Fifth Avenue, located on the corner of Fifth Avenue and West 29th Street in Manhattan’s NoMad district, was sold in an all-cash transaction valued at $25,500,000.  

The prime development site features approximately 130 feet of wrap-around frontage along Fifth Avenue and West 29th Street, providing excellent visibility in one of Manhattan’s premiere neighborhoods.  The existing structure is a five-story, approximately 13,875 square foot mixed-use building, which currently consists of six retail stores and 13 residential units.  Under the current C5-2 (R10) zoning designation, the approximately 2,975 square foot lot has an FAR of 10.0, thus allowing for a total development of approximately 30,000 square feet.  The sale price equates to approximately $850 per buildable square foot.

Located in the heart of Manhattan just north of Madison Square Park, this site is situated in one of Manhattan’s best live/work neighborhoods.  There are a variety of public transportation options servicing the area, including six subway lines as well as the New Jersey Path train and multiple bus lines.  Supported by an influx of new businesses, creative agencies, renowned restaurants, and upscale residences, the NoMad district is one of Manhattan’s most desirable submarkets.

“This transaction was a perfect example of our proactive engagement with the brokerage community. Not only did we send the property information to investors and developers but to all potential co-brokers. Eran Elhanani was able to bring us a highly qualified, first-time purchaser who paid a premium for the property. Our client benefited tremendously from this approach,” said Massey Knakal Chairman Bob Knakal, who exclusively represented the seller in this transaction with Vice Chairman John Ciraulo.  

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Agents: John Ciraulo

Acquisition enhances global real estate services firm with a more formidable Capital Markets presence in the New York Tri-State region.

Cushman & Wakefield announced today that it has entered into an agreement to acquire Massey Knakal Realty Services, New York’s No. 1 Investment Sales firm (based on transaction volume) for more than a decade. The acquisition enhances the global commercial real estate services firm with a more formidable Capital Markets presence in the New York Tri-State region.

Massey Knakal Realty Services was founded by Paul J. Massey Jr. and Robert A. Knakal in 1988. With over 200 employees serving more than 200,000 property owners in New York City’s five boroughs, Westchester County, Long Island and New Jersey, the firm is best known for dominating the market for midsized office, retail and apartment building sales. Since 1988, Massey Knakal has closed more than 5,000 transactions, with a market value in excess of $21 billion.
“This was a very big decision for Paul and Bob and it means a great deal to us that they have chosen to join our firm,” said Ed Forst, President & CEO of Cushman & Wakefield. “Together, they have built a truly dominant force in Capital Markets in the New York metro area. With the Client Only belief that we share, we believe this transformational pairing will have positive implications for our firm here in New York and around the world.”

“This is a very exciting time for us, joining our firm with the Cushman & Wakefield brand that has such deep roots in New York and a global platform that will enhance the breadth of real estate services we can now offer our clients,” said Paul J. Massey Jr., Chief Executive Officer, Founding Partner, Massey Knakal Realty Services. “Bob and I spent time together with our Partners deciding what would be the best opportunity for the firm, with our client’s best interests in mind, and without question, Cushman & Wakefield stood out from the rest. They have a great reputation, led by Ed Forst, who has brought a high level of energy to the firm, and Ron Lo Russo in New York and we’re really looking forward to the opportunity to grow the firm together.”

Cushman & Wakefield’s success in winning the bid was said to be attributed to the firm’s collaborative culture, impeccable brand and highly ethical and talented professionals.

“From the outside looking in, this is a great fit and opportunity for both firms to continue to grow and provide their clients with an added level of expertise on a global platform,” said Ric Clark, Chief Executive Officer of Brookfield Property Partners and a member of Massey Knakal’s Board of Advisors. “Paul and Bob are strong leaders joining a strong brand in Cushman & Wakefield, which resonates in the industry all over the world. I expect to see great things from this collaboration in the years ahead.”

“Massey Knakal is a very well respected high-quality firm, with two leaders in Paul and Bob that I’m really looking forward to working with as we join forces here in New York,” Ron Lo Russo, President, NY Tri-State Region. “The timing couldn’t be more perfect, following a strong year for our firm in New York, led by some of the most talented professionals in the industry. This is an exciting time for both of our firms and we’re poised to bring C&W to greater heights in 2015.”

The acquisition has been approved by the parties’ respective governing bodies and is expected to close prior to year-end 2014, subject to customary closing conditions. Cushman & Wakefield was advised in the acquisition process by Goldman, Sachs & Co. Massey Knakal was advised by Perella Weinberg Partners LP.

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Massey Knakal ICSC Recap

12/12/2014 10:08:50 AM/ Massey Knakal/ News - General Real Estate News

Massey Knakal attended the ICSC National Deal Making New York Conference this week, held at the Javits Center.  The event was ICSC’s largest New York conference to date and featured a keynote presentation by Donald Trump, panels led by industry leaders, networking opportunities, and numerous exhibits.

Agents: Mitzi Flexer

In the latest KNN, Bob Knakal and Jonathan Hageman discuss the negative impact a pied-à-terre tax would have in New York City.

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The Real Estate Board of New York (REBNY) announced the results of its elections for the Commercial Board of Directors, which oversees the commercial brokerage division for REBNY.

James P. Nelson, Partner at Massey Knakal Realty Services, has been elected as the new chairman, succeeding William C. Montana of Savills Studley who served for five years as chairperson. Joanne Podell, Vice Chairman at Cushman & Wakefield, has been elected vice chairman.

“It is an honor and privilege to be of continued service to REBNY,” said Mr. Nelson. “The Commercial Board of Directors will continue to do their part to promote the best interests of the New York City real estate industry and the people who live and work here.”  

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Multifamily owners, operators, investors and experts came together at the Massey Knakal Multifamily Summit & Operations Academy, a two-day event held at the McGraw-Hill Conference Center.  With over 800 in attendance, this was the largest multifamily conference to date.

Day 1, which was an “invite only” event for property and asset managers of multifamily units, offered a boardroom style setting with an in-depth discussion of the key issues.  Day 2 featured over 40 titans of multifamily real estate as they discussed where and how to create value. 

In the morning keynote conversation, Aby Rosen, Co-Founder & Principal of RFR, sat down with Paul J. Massey, Jr., CEO of Massey Knakal, to discuss his career, love of art and the New York City residential market.

In the afternoon, Ofer Yardeni, Co-Chairman & CEO of Stonehenge, discussed how he has shaped the city, the challenges he has overcome, and his expectations for 2015.

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So far in 2014, the strength of northern New Jersey’s commercial real estate market has been linked primarily to the multifamily and industrial sectors, but one of the best-performing subsectors rarely mentioned is medical office buildings. As an inconspicuously popular asset class, medical offices are quietly reaching peak levels of investment and leasing activity at steadily rising prices per square foot and continually compressing cap rates. An evolving healthcare industry, along with a unique stock of buildings in the Garden State, has created ripe conditions for medical office properties to flourish as an outperforming highlight of the northern New Jersey market.

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We asked a few of our agents and directors what's the best part about having the conference right here in New York City.

Michael Azarian: "Home court advantage - understanding that everyone there wants to do business in New York City."

Betty Castro: "The best part is having it local; New York is such an exciting city.  Also, the Javits Center is an excellent venue."

Brendan Gotch: "New York is structurally, financially, geographically, and architecturally unlike anywhere else in the world.  The best part about this conference is that it is tailored to what makes New York unique."

You can find Massey Knakal at Booth 1033 on Monday and Tuesday!

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