The Real Deal New York

Lalezarian pays $1,200 psf for Hudson Yards site

Developer betting big on rezoning of the area

August 07, 2015 03:10PM
By Rich Bockmann

606 West 30th Street and Kevin Lalezarian

606 West 30th Street and Kevin Lalezarian

Residential developer Kevin Lalezarian paid an eye-popping $1,200 per-square-foot for a Hudson Yards development site on the High Line where — for at least the time being — he can’t build a single apartment.

The builder is betting big that the city will rezone the property at 606 West 30th Street. The site sits on one of the few blocks in a booming neighborhood that remains under a restrictive manufacturing zoning, which permits only some retail and small service and repair shops.

Lalezarian Properties paid $36 million, or roughly $1,200 per square foot, to buy the plot from the family of late real estate investor Anita Butensky Katzman, who died in 2009. Cushman & Wakefield’s Bob Knakal represented the sellers, and Bruce Bartell negotiated the deal on behalf of Lalezarian.

The developer could not be immediately reached for comment.

Under the current zoning, the developer is only able raise a building of roughly 30,000 square feet as-of-right. That’s a stark contrast to nearby blocks where sky-scraping apartment towers have risen in recent years behind the backdrop of transformative projects like Related’s Hudson Yards and the High Line.

Last year, as the third and final section of the High Line opened to run past the block, the Department of City Planning said it was looking at rezoning the area. Jeff Levine’s Douglaston Development is reportedly in negotiations to acquire a land lease on a handful of properties surrounding Lalezarian’s site. The price of the lease would depend on how much Levine could build following a rezoning.

Lalezarian, who is on the board of governors at the Real Estate Board of New York and based out of Lake Success on Long Island, is particularly active in the area.

His company is constructing a trio of rental buildings on the High Line at Tenth Avenue, including a 35-story tower that will rival the height of Related’s Abington House just to the north. In Hudson Yards, the company is building a residential/office/retail building on West 36th Street.