The Real Deal New York

Drug-treatment site in Hell’s Kitchen could fetch $40M: broker

Lease on building at 500 West 57th Street expires at the end of 2015

May 15, 2014 03:00PM
By Adam Pincus

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500-west-57th

500 West 57th Street

A local investment company that has for decades owned a building which houses a drug abuse treatment facility has put the property on the market. Some in the industry think the property could sell for $40 million or more.

The owner of 500 West 57th Street — home to the A.R.E.B.A. Casriel addiction abatement center — put the building on the market after talking with brokers who suggested it had untapped potential as a retail store. The nonprofit has a lease that expires at the end of 2015.

The two-agent firm CSRE Real Estate Advisors, founded by broker Christopher Snyder in 2012, won the exclusive listing in March after several years of conversations started by CSRE’s Bryan Winter, an architect and salesperson there.

The 23,906-square-foot building has just under 5,000 square feet of additional development rights, figures from PropertyShark show.

Snyder estimated that the retail space on the ground floor could bring in about $300 per square foot, thus yielding $2 million annually for an owner.

“The retail alone has the potential to be worth at least $40 million,” he said, based on today’s typical 4 percent capitalization rate.

The owners of the property declined to comment.

Developers have recently completed several mega-developments in the area, such as the completed 874-unit Mercedes House at 550 West 54th Street.

Closer are projects in the works include TF Cornerstone’s Arquitectonica at 606 West 57th Street, at 11th Avenue that is proposed to house 1,189 residential units, and the Durst Organization’s 600-unit pyramid-shaped structure at 626 West 57th Street.

  • marknroses

    $300 per sq.ft. for retail on 57th Street, but wrong side (i.e. East between 5th and 3rd), not 11th Ave.

  • Pedro Bosque

    I had this building listed for sale since 2012 in the amount of $20 million and no one was interested. The brother and sister who own this building were in space then now this broker took them to the land of make believe!

  • AMD

    I offered them $22 mm. that they turned down. There are no air-rights and no assembly opportunity for the site. I couldn’t find residential comps that supported a $22 mm deal. CBS is the only one who would pay more than $25mm. This article was wasted time and space.

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