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Deals & Dealmakers

Ares closes on $133M Queens portfolio sale

Ares Management has closed on the sale of its 10-building Queens portfolio for $133 million.

Rosewood Realty Group brokered the of 10 rent-stabilized buildings to A & E Real Estate Holdings and Benedict Realty Group earlier this year.

The sale price equates to $322 per square foot.

The buyers, who are planning a long-term hold of the properties, secured a $75 million acquisition loan with Mesa West Capital financing part of the package and New York Community Bank financed the remainder.

Rosewood Realty Group’s Aaron Jungreis, who represented both the buyer and the seller, said,
“This Queens deal is the first time A&E and Daniel Benedict’s Great Neck-based Benedict Realty Group have partnered together.”

The package includes 531 rental apartments and spans 403,800 s/f. The properties are largely concentrated in the working-class neighborhoods of Elmhurst, Woodside, Jackson Heights and Sunnyside.
One building, the 34-unit property at 38-05 Crescent Street, is in Long Island City. The other nine buildings include: 93-35 Lamont Avenue, 32-15 and 32-25 93rd Street,143-45 Sanford Avenue, 41-46 50th Street, 39-25 65th Street, 39-89 50th Street and 41-45 52nd Street. The deal closed Thursday, Dec. 8 for about $245,000 per unit.

AREA Property Partners and Vantage Properties, two large private-equity shops that went on a rent-regulated shopping spree in the mid-2000s, bought the 10 buildings as part of a 47-building, $300 million portfolio in 2008.

In 2011, AREA bought Vantage out of its stake in their total of 80 Queens buildings, which were then valued at $540 million. In 2013, Los Angeles-based Ares Management acquired AREA Property Partners.
A&E has taken a bite out of Ares’ Queens holdings in the past. In late 2013, A&E paid $300+ million for 29 buildings.

In addition to the Queens portfolio, A&E, led by Douglas Eisenberg and John Arrillaga Jr., is looking to add another 1,000-plus apartments to its holdings.

The Midtown-based investment firm is in contract to buy five Brooklyn buildings for $89 million and is in talks to acquired the 800-unit portfolio of the late Harry Silverstein for $275 million.
Since forming in 2011, A&E has acquired more than 100 buildings and more than 8,800 apartments.

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