A prime bit of Times Square retail, next door to the Witkoff Group’s massive planned retail and hotel project, is in contract for $10.6 million, The Real Deal has learned.
The four-story building at 146 West 47th Street will be delivered vacant, so new owner Ascot Properties NYC – a Manhattan-based real estate investment company that has bought a number of Manhattan retail properties in the same range recently – will be able to raise rents to the ever-higher sums the area has commanded recently, said Kevin Salmon of Khizer Salmon, who represented the seller in the deal.
Michael Brown, vice president at Ascot, cited those rising rents as the reason for the buy. “We want to take advantage of the retail market. I think rents went up 45 percent [in Times Square] in the last year.”
Indeed, retail rents for the tourist-ridden nabe are starting to give Fifth Avenue a run for its money, with rents as high as $2,400 a square foot in the fourth quarter of 2012 — a 42 percent increase from the same period in 2011, according to the most recent numbers from commercial brokerage CBRE.
The owner is a local investor by the name of Salim Gorur, who took control of the building in 1996, though the price was not immediately clear from city records. A Turkish restaurant called Dervish had been in the ground floor of the merely 20-foot wide space for over 10 years and the lease is up, Salmon said.
No contact number was listed for Gorur.
Brown said Ascot had not yet finalized plans for the skinny 5,400-square-foot property, because of a long contract period in the deal.
Just down the block, Midtown-based Witkoff — in partnership with a large group of investors, including Howard Lorber’s Vector Group and Michael Ashner’s real estate investment trust Winthrop Realty — purchased 701 Seventh Avenue for $430 million, including air rights, last year. They plan a retail and hotel development on the plot, which took years to assemble.
Salmon said he thought the buyer could generate additional revenue renting Times Square signage space. The Durst Organization has earned millions leasing out signage in the area, as The Real Deal has reported, and retailer Express – whose contract to take space at 1552 Broadway earned the Real Estate Board of New York’s title “most ingenious” retail deal of the year last night – was able to afford its Times Square digs due to sign lease revenue.
As for tenants, nothing has been decided, but Salmon had one idea: “People like the guys getting kicked out of Witkoff’s property are going to be looking.”