A half-empty apartment building near City Hall has traded hands at a major discount, in an indication of how the pandemic has impacted rental property values.
Joe and Rachelle Friedman, the owners of the iconic but now-defunct J&R Music World, sold the 31-story apartment building at 15 Park Row — once the tallest building in the world — to investor Atlas Capital Group for about $140 million, sources familiar with the transaction told The Real Deal.
The property includes the retail space that for years served as home for J&R, as well as 330 rental apartments.
Roughly half of those apartments are now empty, according to a source familiar with the property, a result of tenants leaving the city over the past year.
The purchase price works out to less than $400,000 per unit. Pre-pandemic, similar apartment buildings in the Financial District might trade for about $500,000 per unit, brokers said. That would represent a drop in value of about 20 percent.
A representative for the Friedmans could not be immediately reached for comment, and a spokesperson for Atlas Capital declined to comment. Helen Hwang at Meridian Investment Sales brokered the sale. A spokesperson for Hwang did not immediately respond to a request for comment.
Atlas, headed by principals Jeffrey Goldberger and Anrew Cohen, plans to make improvements to the property, similar to other residential buildings it’s invested in at 225 West 23rd Street in Chelsea and 224 East 39th Street, according to a source familiar with the company’s plans.
The Friedmans in 2017 teamed up with L+M Development to build a 49-story condo tower next door at 25 Park Row.