The Real Deal New York

Jeff Kaye’s Stone Street buys Gramercy rentals for $123M

Broad Street Development put 210 and 220 East 22nd Street on the market in April

September 24, 2015 11:18PM
By Rey Mashayekhi

Jeffrey Kaye Stone Street

From left: 220 East 22nd Street, Jeffrey Kaye and 210 East 22nd Street

Jeffrey Kaye’s Stone Street Properties just closed on the acquisition of two Gramercy Park rental buildings, at 210 and 220 East 22nd Street, for a combined $123 million, or a little over $1,030 per square foot.

The seller was a partnership between Broad Street Development and Crow Holdings, which put the pair of buildings on the market in April with a target price of $130 million. Combined, the properties hold 208 rental units across almost 120,000 square feet, with rents averaging $3,450 per month, according to StreetEasy.

Representatives for Stone Street and Broad Street could not be reached by press time. HFF’s Andrew Scandalios, who represented the seller, couldn’t be reached. The properties were marketed as “ideal” for a potential condo conversion, but a source familiar with the deal said Stone Street is likely to continue operating them as rentals.

Stone Street, founded in 2011 by Kaye and Robert Morgenstern — who is no longer at the firm — spent its first two years amassing a substantial Manhattan multifamily portfolio. But recently, it has been actively selling off Manhattan properties. In January 2014, it tapped Cushman & Wakefield’s Bob Knakal, then of Massey Knakal Realty Services, to market a five-building portfolio for $150 million. It then sold five connected buildings on Elizabeth Street in Soho for $61 million to Galil Management (formerly E&M Associates), and sold a 16-building portfolio to Jared Kushner for $132 million. Both those deals closed in March.

Broad Street, headed by Raymond Chalme and Daniel Blanco, and Dallas-based investment fund Crow Holdings acquired 210 and 220 East 22nd Street for $85 million in 2012. The partners put about $4 million into renovations at the properties, which are mostly comprised of studio and one-bedroom apartments. They also teamed up on the $179 million purchase of two Noho apartment buildings late last year. City records then indicated that Broad Street was seeking to demolish one of the buildings and replace it with a structure cantilevering over the other, after the developer transferred roughly 25,000 square feet of air rights between the properties.