By Daniel Geiger
An over 100,000 s/f block of commercial office space in the Setai Wall Street is in contract to be sold to a group led by the real estate investor Joel Schreiber, several sources familiar with the deal say.
Schreiber, who is the principal of the real estate investment group Waterbridge Capital, will pay less than $20 million for the space, which is about 110,000 s/f in size and comprises the building’s first seven floors. Although the exact purchase price was not disclosed by press time, sources put the transaction amount at between $16 and $17 million.
The deal, which has not yet closed, will come on the heels of a recent transfer of the Setai’s mortgage that placed ownership of the 34-story building’s unsold residential condo units in the hands of the investor Zeil Feldman. Feldman purchased the debt, which written reports indicated had an outstanding balance of $147 million, from the troubled Irish lender Anglo Irish Bank for around $80 million.
The former office building, located at 40 Broad Street in lower Manhattan, was converted into high end residential units by the real estate firm Zamir Equities, but the construction work fell behind schedule, went over budget, and ran into a serious recession that dashed ambitious sales projections. Zamir ended up defaulting on the project in 2009, though the company was able to sell about half of the building’s residential units.
The bulk of the Setai is residential space, but the base of the building holds the office and commercial component, including a small ground floor retail space, a restaurant on the second floor, the Setai’s spa and gym on three, and office space on floors four through seven.
According to people familiar with the space, floors four and five are largely leased to office tenants, including some who had been in the building prior to its conversion into a luxury residential property. Floors six and seven are vacant, sources say, and will likely be partitioned into smaller condo units and sold piecemeal or to full floor buyers.
Schreiber could hold onto floors one through five as income producing investments, or sell off those as well. One source said it was likely he would hold and operate that portion of the space.
Schreiber arranged to buy the Setai’s commercial condo from Zamir Equities, which had hung onto the space even as things went bad upstairs.
Asher Zamir, principal of Zamir Equities, confirmed that the property was in contract to be sold to Waterbridge, but couldn’t comment further. Calls to Waterbridge were not returned by press time.
The Xerxes Group, a real estate investment company founded by Daniel Gohari, a former vice president at the Moinian Group, and his brother Arash Gohari, a former private equity fund manager, was involved in the  $80 million residential condo transaction, according to sources. Neither of the brothers could be reached for comment.
