GFI Realty Services announced that it arranged the $195 million sale of 23-02 49th Avenue, a seven-story, 656,000 s/f warehouse in the Long Island City section of Queens.
The property, which traded for an in-place cap rate below three percent, is fully occupied by three tenants whose leases are expiring in 2020.
The transaction was arranged by GFI Realty Managing Director of Investment Sales Yosef Katz and Director Yisroel Pershin. The buyer plans on converting the building into creative office space upon the termination of the current lease.
Westbrook Partners and investor Andrew Chung partnered on the purchase from investors, Rubin Schron’s Cammeby’s International and the Fruchthandler family, according to the Real Deal.
“The extremely low cap rate demonstrates the strong confidence that the buyers have in Long Island City’s long-term potential,” said Katz.
“While value-add renovations and subsequent lease-up are several years out, the buyers recognized this as a unique opportunity to capitalize on an extremely well-located asset.”
The majority of the building is occupied by the New York City Housing Authority. The other tenants are Eagle Transfer Company and Mayo Studios.
“Long Island City office is booming, and industrial conversion is bringing many new office properties to market,” Pershin added.
“Once the property is converted to office use, the buyers anticipate strong leasing activity because of the unmet demand for creative office facilities and the ability to offer space at a 50-percent discount to Manhattan rates.”