NYC REIT Acquires $88M Lower East Side Retail and Commercial Condos
The REIT acquired the 196 Orchard St. condominium units totaling 60,297 square feet.
NEW YORK CITY—New York City REIT completed its acquisition of two retail condominiums and one commercial condominium at 196 Orchard St. The properties spanning the sub-level, ground level, second and third floors total approximately 60,297 square feet. The public non-listed REIT purchased the property from Magnum Management and Real Estate Equities Corp. for approximately $88.8 million.
New York City REIT’s portfolio consists of mixed-use office buildings and retail condominium units in New York City.
The property is 100% leased by three well known retail tenants, the chains Marshalls, CVS and Equinox. High occupancy, rent escalators and a weighted average remaining lease term of 13.4 years provide NYCR with an expected long-term stable cash flow and contractual rent growth.
Nationwide Life Insurance Company provided a $51 million loan for the purchase, secured by a mortgage on the property. The loan has a 3.85% fixed-rate interest and matures on August 1, 2029. NYCR funded the remaining $37.8 million of the purchase price with cash.
Hodges Ward and Elliott’s Paul Gillen and Kyle van Buitenen marketed the property and represented the sellers, Magnum Management and Real Estate Equities Corp.
“The acquisition of three modern retail condominiums at 196 Orchard St. is an exciting transaction for NYCR,” says the REIT’s CEO Michael Weil. “The space is fully occupied by high-quality, experiential tenants subject to long-term leases with contractual rental increases.” He further notes the deal’s favorable long-term financing enhances the REIT’s overall portfolio.