NEW YORK CITY—Dalan Management and RWNReal Estate Partners have purchased the 99-year groundlease for the Indigo—located at 230 E. 44th St.—for $47 million.The seller is a partnership of Atlantic RealtyGroup, Moezinia Bros. Capital and230 MD Member.

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M&T Bank provided a $36.2 millionacquisition and renovation loan—brought in by HKS CapitalPartners—and Daniel Rahmani ofVenture Capital Properties brokered the deal. The14-story, 135,315 square-foot, mixed-use building features 164residential apartments, a 25,000 square foot parking garage and3,700 square feet of retail space that's fully occupied by arestaurant and a nail salon.

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The building is on a ground lease and the joint venture buyersacquired the leasehold interest in the property. The leaseoriginally had 14 years remaining before a fair market rent resetwas to take effect. The buyer was able to sign a “softcontract” during which time it restructured the ground lease to abrand new 99-year-term with contractual rent, no fair market rentresets and other improved terms.

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Dalan and RWN plan to conduct a comprehensive rehabilitation andrepositioning program to update apartment finishes, renovate thelobby and common areas and add modern amenities to the property.With three new ground up, high-rise developments under way on thesame block, along with the building's close proximity to GrandCentral Station and the United Nations, the redevelopmentreportedly is well situated to take advantage of the city's strongmultifamily market.

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“We are extremely pleased that we were able to fully renegotiateand extend the ground lease in a manner that makes the plannedredevelopment of the property economically attractive to Dalan andRWN,” says Ari Shalam, managing principal ofRWN.

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Adds Daniel Wrublin, founding principal ofDalan, "We are excited to acquire a substantial asset centrallylocated in the middle of Manhattan. We plan to modernize andimprove the property to make it a desirable place for residents tolive for years to come."

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Dalan and RWN have acquired approximately $150 million inproperty together over the past two years. This asset purchasecomes on the heels of Dalan's recent $36 million purchase of 10-12East 33rd Street in Manhattan from Adee Associates earlier thismonth.

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Rayna Katz

Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.