Madison Capital JV Sells UES Retail Asset

Located between Lexington and Park avenues, 123 E. 86th St. is triple-net leased by Citibank.

NEW YORK CITY—A multi-level retail building leased to Citibank on the Upper East Side sparked significant interest from both public and private investors before trading at nearly $3,500-a-square-foot. New York City-based Madison Capital and a global real estate investment management firm have sold 123 East 86th St. to a private investor, reports brokerage firm Holliday Fenoglio Fowler, which represented the Madison Capital partnership in the transaction. The 7,018-square-foot property that is triple-net leased to Citibank, traded for $24.5 million, or $3,492-per-square-foot. The investment sales team that represented the seller was led by HFF managing directors Rob Rizzi and Jeff Julien, senior managing director Eric Anton and associate director Steven Rutman. PD Properties’ Elad Dror and Tony Park represented the buyer. “We received a tremendous response from a wide range of private and institutional investors, highlighting New York City’s appeal for high-street properties, as well as the continuing demand for cash flowing retail,” Rizzi says. Completed in 1927 and renovated in 1998, the building is fully leased to Citibank on a triple-net-lease basis through 2022 at rents significantly below market, according to HFF. The building consists of three above-grade levels with an additional 2,234 square feet of lower-level space not included in the rentable square footage. Situated on a 3,021-square-foot lot between Lexington and Park avenues, 123 E. 86th St. is located in the 86th Street retail corridor that features Whole Foods, H&M, SoulCycle and Sephora, and also is adjacent to the 86th Street subway station.