The Real Deal New York

Sloan Kettering buys apartments in former Miraval tower for $29M

Cancer center scoops up 14 units at 515 East 72nd Street

August 28, 2012 04:30PM
By David Jones

515 East 72nd Street
(credit: PropertyShark)

Memorial Sloan Kettering Cancer Center has paid $29.3 million for at least 14 apartments at 515 East 72nd Street, the condominium tower formerly known as Miraval Living, according to documents obtained by The Real Deal. The apartments were sold to the famed Upper East Side hospital in June, as part of a push to boost unit sales. The deal follows efforts to recapitalize the property in 2010 and the sponsor’s subsequent split with luxury spa operator Miraval Resorts.

The cancer center “has purchased residences for long-term use by their senior medical doctors and staff at 515 East 72nd Street,” a spokesperson for the sponsor, said in a statement. Christine Hickey, a spokesperson for the hospital was not able to immediately comment on the 515 East 72nd Street deal, but noted that “we often acquire apartments for staff.”

Michael Gutnick, who is listed as assistant treasurer, S.K.I. Realty Inc., signed the deed. Hospital officials confirmed that the realty operation handles real estate transactions for the hospital.

In 2010, the Manhattan-based fund Square Mile Capital Management entered a deal with Westbrook Partners to recapitalize the property, which was in severe financial distress. Square Mile had previously taken control of the property from its original developers, Zamir Equities and C&K Properties, under a complex recapitalization in 2007.

Jim Derow, a principal at Square Mile, is still listed as the authorized representative for the sponsor entity. Derow was not immediately available for comment.

A spokesperson for the sponsor says that 515 East 72nd Street has sold 66 percent of its apartments, but refused to give a whole number. In a June 4 announcement, Corcoran Sunshine Marketing Group, the on-site brokerage for the condo, said more than $59 million in apartments had been sold in 90 days. According to Streeteasy.com, the building has 329 units and 214 recorded sales, averaging $1,208 a square foot.

The Real Deal has also learned that Sotheby’s International Realty has sent letters to unit owners in the building, claiming that it has acquired multiple apartments on behalf of Asian buyers. Lisa Maysonet, senior vice president at Sotheby’s, told The Real Deal that up to seven to 10 apartments have been acquired on behalf of Asian investors and confirmed the letter asking unit owners if they would be interested in selling or renting out their units. “We’re looking to buy more and we have bought others around the city,” she told The Real Deal.

Records filed with the city Department of Finance show two sponsor-owned units were acquired by Asian investors, including a 1,000-square-foot two-bedroom for $1.4 million and a 1,081 square-foot two-bedroom unit for $1.2 million.

A spokesperson for the condo denied that there were any bulk units being sold through Sotheby’s. Corcoran Sunshine Marketing Group, the official sales agent for the building, declined comment for the story.

Three sources familiar with the Memorial Sloan Kettering deal said that unit owners voted to approve the bulk sale, and a change in the building’s bylaws that governs who can live in residential apartments, but that those owners were told that at least 20 units would be sold in bulk.

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