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Deals & Dealmakers

Selling Points: Adam America planning new LIC tower, $45M deal for legacy site

Adam America planning new luxury LIC tower

Adam America Real Estate is planning to build a new luxury apartment tower in Long Island City,

Eastern Consolidated arranged the sale of the development site at 22-12 Jackson Avenue for $43.5 million.

Adam America said it will raze the existing property and build a new condominium tower.

Zoned for 169,500 s/f, 22-12 Jackson Avenue is across from MoMA PS1, down the street from the 1.2 million-square-foot development at 5Pointz, and adjacent to the new 182-unit, mixed-use apartment building designed by ODA and developed by Jeff Gershon.

Ronald A. Solarz, principal and executive managing director at Eastern Consolidated, along with Chris Matousek, director, Financial Services, exclusively represented both the buyer and the seller, Diamond Service Corporation.

The existing 33,900-square-foot lot at 22-12 Jackson Avenue is currently occupied by a taxi company.

Solarz commented, “Long Island City is one of New York’s most exciting, growth markets with incredible demand for additional residential product.”

22-12 Jackson Avenue is close both to Citigroup’s 1.5 million-square-foot office tower and the recently announced 1,800-unit residential development from Tishman Speyer and H&R REIT.


$45M deal for legacy site

After a lengthy qualification process, the New Jersey Sports and Exposition Authority accepted a bid for $42.5 million from Russo Development of Carlstadt and Forsgate Industrial Partners of Teterboro to purchase and redevelop the 718 acres of remediated landfills in the Meadowlands known as the Kingsland site.

Both firms are headquartered within miles of the property and have extensive remediation and development experience in the region.

“Our firms are committed to New Jersey’s redevelopment initiative,” said Ed Russo, Russo’s chief executive officer. “We made a decision over a decade ago to enhance our home state by creating high-quality development paired with landscape-rich open space in areas that were previously overlooked by others.

“This site is the capstone of that initiative and we are grateful for the opportunity to make it a part of our legacy.”

Added Alex Klatskin, FAIA, general partner at Forsgate Industrial Partners, “Forsgate constructed its first building in the Meadowlands almost 50 years ago. We are honored to have been chosen to continue our commitment to the environmental and economic ecosystems of the region.”

Preliminary plans for the Kingsland Development include distribution facilities, data centers, solar farms, the creation of a nature trail in the Rutherford Wetlands, extensive landscaping, green building design, and infrastructure improvements.

Griffin Capital pays $81M for Jersey property

Mack-Cali Realty Corporation has sold its office property at 14 Sylvan Way, in the Mack-Cali Business Campus in Parsippany, New Jersey, for $81.4 million to Griffin Capital Essential Asset REIT II, Inc.

In addition to the sales price, Griffin is assuming responsibility for approximately $2 million in future tenant improvement allowance.

14 Sylvan Way was developed in 2013 pursuant to a long-term, net lease to serve as the extension of Wyndham Worldwide Corporation’s headquarters. The three-story, 203,506 s/f class A office building is fully leased to Wyndham.

Mack-Cali was represented in the transaction by Jose Cruz and Kevin O’Hearn, both of HFF.

Mitchell E. Rudin, chief executive officer of Mack-Cali, commented, “This was an excellent opportunity to monetize the value of this class A corporate headquarters. The proceeds will be reinvested into more strategic growth opportunities.”

Michael Escalante, Griffin Capital’s Chief Investment Officer added: “Given the investment grade credit quality of the tenant, long-dated lease with annual rental rate increases, and strategic location in thelargest metropolitan area in the United States, this acquisition is an excellent addition to our REIT’s institutional-quality portfolio.”

MRC exits Williamsburg investment

Madison Realty Capital (MRC) announced the $37.4 million sale of 385 Union Avenue in Williamsburg.

The six-story property has 47 residential apartments comprising approximately 40,000 rentable square feet.  Josh Zegen, co-founder and managing Principal of MRC, made the announcement.

The property was originally in foreclosure and under management of a receiver. MRC was able to negotiate the acquisition of the debt with the previous lender, the release of all existing subordinate liens and the transfer of the deed from the existing owner for $21.55 million in May 2012.

After taking title to the property, MRC was able to obtain a final certificate of occupancy, re-instate prior tax abatements and renovate the property to a Class A standard.

The property was then sold by MRC through an off-market transaction facilitated by Aaron Jungreis of Rosewood Realty Group, who represented both the seller, and the buyer, Sugar Hill Capital Partners.

“We’re particularly proud to exit this investment, which exemplifies the benefits of our vertically integrated structure,” said Josh Zegen, Co-Founder and Managing Principal of MRC.

“We entered the deal through a distressed acquisition in 2012 and were able to implement an effective strategy which stabilized the asset and maximized value for all parties.”

Queens Walgreens fetches $16M

Marcus & Millichap announced the sale of a freestanding, 10,500 s/f Walgreens drugstore in tQueens. The $15,684,000 sales price equates to $1,494 per square foot.

Steven Siegel and Michael Kook in Marcus & Millichap’s Manhattan office represented the seller and procured the buyer.

“The property is a dominant drugstore in a densely populated trade area,” said Siegel. “The store’s location and sales volume drew interested buyers from throughout the net-leased property investment community.”

Built in 2010, the Walgreens drugstore is located on a 0.71-acre parcel on Guy R. Brewer Boulevard in Queens.

HFF’s Repositioning strategy pays off

HFF has closed the $14.225 million sale of 2217 Caton Avenue, a 24,214 s/f mixed-use building in Brooklyn’s Prospect-Lefferts Gardens neighborhood.

HFF marketed the asset on behalf of Second City Real Estate. Caton Acquisition Partners, LLC purchased the asset free and clear of existing debt. HFF previously assisted the seller in securing financing for the property in January 2014.

2217 Caton Avenue was built as condominiums in 2010. The nine-story property has 29 two-bedroom rental units that are 97 percent leased, and 2,698 s/f of ground floor retail space, which is fully occupied by a local daycare center. The property is near Prospect Park and benefits from a 421-a and ICIP tax abatement.

The HFF investment sales team was led by managing directors Rob Rizzi and Jeff Julien, associate director Rob Hinckley and real estate analyst Steven Rutman.

“Second City Real Estate executed an exceptional repositioning strategy, getting into a prime Brooklyn neighborhood early in the cycle, substantially improving the asset’s operations and creating impressive increases in profitability and ultimately value,” said Rizzi.

Management company makes long-term play

Black Spruce, a Manhattan based management company led by Josh Gotlib, has continued its buying spree with a $11.5 million purchase in Gravesend, Brooklyn.

The company announced it has purchased 51 Project Based Section 8 units spread throughout 17 three-family homes on 2320-2336 West 11th, 2302-2324 West 12th and 2315-2321 West 13th Street in Gravesend.

The properties were owned by Brooklyn based E and M, which purchased them in 2006 for $4,500,000 in 2006.

In recent months, Black Spruce has purchased a $58,000,000 Bronx portfolio from Normandy.

“Josh will do very well with these properties as a long-term, safe investment that will only keep growing with future value in both the rents and location,” said Steven Vegh who was the sole broker in the off market transaction.

Investors to return landmark to former glory

Real estate investment firm Westport Capital Partners announced that an entity owned by a fund managed by Westport has acquired Goodwin Square in Hartford with co-investors Brian Kohn and Steve Kohn.

Goodwin Square includes the 30 story office tower and the Goodwin Hotel. The property was purchased at general auction for $16.6 million.

Jordan Socaransky, principal at Westport, said, “We are very pleased to acquire Goodwin Square, with its landmark office tower that defines the Hartford skyline, the historic Goodwin Hotel that once offered all the modern conveniences and is missed by many, and the Atrium, with its breathtaking spaciousness and multipurpose functionality.

“For too many years Goodwin Square has been under-utilized, and we plan to invest in the office tower and the atrium to bring them back to their former glory as we attract tenants and guests to these special properties.

Goodwin Square comprises almost a complete city block in Hartford’s central business district.

The Class A office tower, which measures 330,901 s/f and is built over an eight story, 302-car garage, is a Hartford architectural icon that was designed by Skidmore, Owings & Merrill (now SOM) and completed in 1989.

The 124 room Goodwin Hotel, which has been closed since 2009, totals 110,000 s/f and includes 24 suites, conference areas, a restaurant and bar.

The hotel was constructed in 1989, beneath its historic façade, which dates back to 1881, and received a $4 million facelift in 2002.

The Hotel is on the National Register of Historic Properties and was once the home of J.P. Morgan.

The office tower and Hotel are connected by a multi-story atrium that once served as an event destination and general area attraction.

An adjacent land parcel, which was included in the purchase, currently provides additional parking but also offers future development opportunity.

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