The Real Deal New York

MTA bus depot near JFK hits the market

GTJ REIT's 7-acre Jamaica site could sell for $140M: sources

March 09, 2016 02:15PM
By Mark Maurer Twitter_logo_blue copy

MTA bus depot

165-25 147th Avenue in Jamaica (credit: Rochlin Organization)

Wanted: Buyers near flyers. GTJ REIT is shopping not one but two seven-acre sites near both international airports in Queens, The Real Deal has learned.

In addition to Budget Rent a Car-occupied parcels south of LaGuardia, the Long Island-based real estate investment trust hopes to sell the MTA bus depot just north of John F. Kennedy Airport in Jamaica, according to marketing materials.

The 6.8-acre site at 165-25 147th Avenue holds a 151,000-square-foot, two-part structure. A one-story industrial building and a two-story office property are attached. There are also 143 bus storage spaces and 25 parking spots.

Sources said the site is expected to sell for about $140 million.

Given the City of New York’s long-term triple net lease on the site, development is not an option in the near future. The earliest possible expiration of the lease is 2027. But if the city were to take advantage of two 14-year options, the lease could expire as late as 2054.

The Metropolitan Transit Authority, the largest transit network in the U.S., has subleased the site as a bus terminal since the early 2000s.
Under the city’s agreement, GTJ sees close to a zero percent return, sources said. That would change after the lease expires.

The annual rent income is currently $3.38 million, the documents show. There have been 10 percent rent increases every five years.

Sources said the REIT is seeking to capitalize on the value of both assets.

Meanwhile, the GTI’s seven-acre site at 23-85 87th Street and 25-27 87th Street is being marketed as a development opportunity, as Avis’ lease is expiring in 2023. That site is zoned for both residential and commercial.

The Rochlin Organization’s Bruce Nelson, Austin Mandell and Adam Rochlin are marketing the Jamaica site on behalf of the REIT. The brokers declined to comment, while GTJ could not be reached.