[Updated at 3:20 p.m. with comment from Studley, Real Capital] Laurence Gluck’s Stellar Management and Largo Investments have sold 111 Kent Avenue, a 62-unit luxury rental building in Williamsburg, for just under $56 million, one year after the firm purchased the stalled project, sources told The Real Deal.
The purchaser is American Realty Advisors, a Glendale, Calif.-based institutional investor and manager, sources said. Management of the building will be transferred to Cooper Square Realty, the largest residential property manager in New York City, from Stellar.
The sale marks the highest price per unit ever paid for a multi-family building in the borough, according to data from Real Capital Analytics.
Stellar, which partnered with Largo Investments to buy the building in March of 2011 from Garrison Investment Group for $24.6 million, told Crain’s in March, when the property hit the market, that the intention had always been to sell it. Stellar retained commercial brokerage Studley for the sale, with executive managing director Woody Heller representing the seller in a team with colleagues Will Silverman, Eric Negrin and Daniel Parker.
“For years northwestern Brooklyn has been a market of preference rather than necessity for tenants,” Heller said. “The same is now happening for institutional investors.”
The price, which equates to nearly $900,000 per unit, says a lot about luxury multi-family in Brooklyn as an asset class, brokers not involved with the transaction said.
“With everyone focused on the super hot Silicon Alley office market, astute multifamily investors have started thinking about where the people who work at those firms live,” Silverman told The Real Deal.
Calls to American Realty were not immediately returned.
The building, between North 7th and 8th streets, hit the rental market last September, and was 50 percent rented within a week.
The project broke ground in 2007, and struggled through the recession, as the original developer, whose name has not been reported, defaulted on the loan, according to published reports. The original developer bought the land for $15.7 million, according to public records. Garrison then purchased the green glass and brick building for $43 million in late 2010, after only nine units had sold, Brownstoner reported at the time. Then, last year, Stellar nabbed the building when it was 90 percent complete, saying it would spend $8 million completing the lavish amenities and converting it to rental. Aptsandlofts.com was the building’s exclusive marketer.
Tenants say the build-out is not yet complete, but marketing materials for the building note that the amenities — such as a game room, yoga room, roof deck and pool — are only “planned.” Asking rent was $2,705 per month for a 728-square-foot one-bedroom when the units first hit the market. Streeteasy.com shows a two-bedroom with asking rent of $5,442 today.
Stellar declined to comment.