Silverstone inks $18M deal for Gramercy rental

Investment company could opt to convert property to condos

TRD New York /
Jun.June 18, 2013 12:00 PM

Silverstone Property, a Manhattan-based real estate investment company, has acquired a seven-story residential rental building in Gramercy for $17.9 million, The Real Deal has learned.

The 14-unit building, at 78 Irving Place, traded for $1,115 per square foot in the deal, which closed  yesterday. Peter Von Der Ahe, Joe Koicim and David Lloyd of Marcus & Millichap represented both the buyer and the seller, a partnership of two brothers operating under the name Renrose Realty, which had owned the property for more than 40 years.

The brokers said there had been global interest in the asset, with several groups looking at the property as a prospective conversion to a single-family home. The 16,069-square-foot building also could be converted into a luxury condominium or redeveloped as high-end rental apartments.

The property’s rental units now are leased at for about $50 a square foot, 44 percent below market rate. The building, on the southeast corner of Irving Place and East 19th Street, comes with a 1,200-square-foot carriage house.

Silverstone has not yet filed plans for the property with the city’s Department of Buildings. Company President Martin Nussbaum declined to comment, saying only that it was the property’s “true” Gramercy Park location that attracted the company to the deal.

“With the Zeckendorf luxury condominium conversion across the street setting records of around $4,000 per square foot, I have strong confidence that Silverstone will do extremely well with this,” Koicim said, speculating that Silverstone might opt for a condo conversion.

The most high-profile condo conversions in the Gramercy Park area have traded at prices of more than  $3,000 a foot, according to an offering memorandum provided to The Real Deal by Marcus & Millichap. At 18 Gramercy Park, for instance, the penthouse went into contract for $42 million, or $6,600 per square foot.

Silverstone, an affiliate of lender Madison Realty Capital, was formed during the downturn and has been  making deals both in Manhattan and Brooklyn. In Dumbo, the company recently purchased a three-story manufacturing building for $45 million, which it plans on converting to condos. Nussbaum said the company is still on the hunt for “high-quality properties” in the New York metropolitan area.


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