The buyer, a local owner and operator of a number of retail stores in the area, has leased the site back to ICON for a 25-year period, but the agreement is cancellable at any time at the owner's discretion, according to Eastern Consolidated's Brian Ezratty, who represented the seller. The site would allow for a 100,000-sf structure, although Ezratty tells GlobeSt.com that the there is no time frame for development yet. The site now houses an eight-story, 325-car facility.
"The property is located on a good Midtown South block," says Ezratty. "The buyer is in a favorable position because he can build either a hotel or condominium on the site, or he can do virtually nothing and continue to enjoy operating an income-producing property until market fundamentals change to his liking."
Ezratty and colleague Scott Ellard represented ICON while Ezratty along with Helmsely-Spear's Parviz Noghrey represented the buyer.
This deal follows closely on the heels of two other recent deals in the Midtown South submarket. Isaac Chetrit purchased 989 Avenue of the Americas and 240 W. 37th St. for a total of $92 million, as GlobeSt.com exclusively reported. Additionally, at the beginning of March, a parking garage sold for $31 million to Brack Capital Real Estate USA. The new owner plans to turn 63-67 W. 35th St. into a 30-story, 300-key hotel.
The area has been profiting from the tight Midtown market, which has an office vacancy rate of 4%, according to the most recent statistics from CB Richard Ellis. The vacancy rate in Midtown South has dropped from 5.7% a year ago to 4.3% now. The average asking rent in the area is up almost $10 to $43.04 per sf.
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