The British bank Barclays has moved to sell a substantial development site on the far West Side that it seized last year from the powerhouse New York developer Gary Barnett.
350-366 Tenth Avenue, a vacant patch of land where Barnett had once planned to build a soaring 600,000 s/f mixed use tower, fell into default in 2009 when Barnett could no longer service a $28.8 million loan he had with the bank. Barnett, who is the chief executive of the real estate development company Extell Development, told Real Estate Weekly at the time that he was negotiating with the bank.
Later, when Barnett turned the parcel back to the bank, he stated in media reports that a European partner had backed out of the deal to hold onto the development site, which likely would have included an infusion of money from Barnett and that investor.
Barnett is one of the city’s most successful and prolific developers. In recent months he began construction on a mixed use skyscraper on 57th Street at a time when few other developers have had the financial wherewithal or the access to capital to begin building new space.
Barnett spent at least $40 million assembling the site on Tenth Avenue, which sits across the avenue from the West Side rail yards. The area has been seen as important new frontier of Manhattan development. An extension of the No. 7 to the rail yards is expected to soon be completed and The Related Companies, another New York based development firm, has plans to build millions of s/f of office, residential, retail, and public space on a platform over the yards. Other developers have bought up buildings and development sites in the vicinity in order to capitalize on the neighborhood’s expected popularity and commercial potential.
Barclays has hired a team from the real estate brokerage company Massey Knakal Realty Services led by the company’s chairman Bob Knakal to market 350-366 Tenth Avenue and handle the sale. Knakal, who has become an active seller in the city of distressed deals, foreclosures, and mortgage notes during the downturn, said that he couldn’t comment.
One source familiar with the site said that it could trade for at least as much as Barnett paid for it, an indication that real estate development in the city, after grinding to halt during the recession, could be reviving now that the economy has begun to recover.
