REBusiness Online | July 21st, 2016
By John Nelson
NEW YORK CITY — GFI Realty Services LLC has arranged the $195 million sale of 23-02 49th Ave., a seven-story, 656,000-square-foot warehouse in the Long Island City section of Queens. The property is fully occupied by three tenants whose leases are expiring in 2020: the New York City Housing Authority, Eagle Transfer Co. and Mayo Studios.
The undisclosed buyers plan on converting the building into office space upon the termination of the current leases. According to Crain’s New York, the buyers are Westbrook Partners, a privately owned real estate investment management firm, and investor Andrew Chung, a former executive with the Carlyle Group. Crain’s reports the sellers are Ruby Schron and the Fruchthandler family.
“Long Island City office is booming, and industrial conversion is bringing many new office properties to market,” says Yisroel Pershin, director of GFI Realty. “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.”
Pershin and Yosef Katz of GFI Realty brokered the sale of the warehouse, which traded at a capitalization rate below 3 percent.
“The extremely low cap rate demonstrates the strong confidence that the buyers have in Long Island City’s long-term potential,” says 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 property is located in proximity to the 7 train and the Long Island Rail Road metro system, providing access to Manhattan, Queens and Long Island.
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