Toll Brothers’ $150M Flatiron buy trounces price estimates

Development site was expected to sell for $80 million in March

Sep.September 24, 2013 02:35 PM

National homebuilder Toll Brothers is in contract to buy a nonprofit’s Flatiron District headquarters — on a lot that allows for a 200,000-square-foot residential development — for $150 million, or more than $750 per buildable square foot, The Real Deal has learned.

United Cerebral Palsy listed the property, at 122-130 East 23rd Street between Lexington Avenue and Park Avenue South, in March with Avison Young brokers Jon Epstein, Charles Kingsley, Neil Helman and Vin Carrega. At the time, insiders reportedly expected the site to fetch a mere $80 million,or $400 per buildable square foot.

The nonprofit agency uses a 60,000-square-foot property at the site for pre-school and recreation programs and plans to remain in place through December 2014. However, zoning allows for a residential building to rise to 210 feet on East 23rd Street and 135 feet on East 22nd Street.

Toll Brothers declined to comment on the deal. A spokesperson for the nonprofit could not be reached.

Carrega told TRD that the deal would likely close by the end of the year pending approval by the Attorney General’s office. The AG’s approval is required as a result of UCP’s nonprofit status, he said.

For Toll, the property is the latest in a string of acquisitions of prospective condominium sites. The company paid $56.5 million for a Hudson Square site at 82 King Street in December 2012 where it will build roughly 150 units. Also in December, Toll bought a stalled condo site at 953-961 First Avenue from the Alexico Group for $64 million.

The company is slated to launch a new project at 400 Park Avenue South with Sam Zell’s Equity Residential in the coming months. Zell developed 265 rental apartments on the lower 22 floors of the building while Toll built 100 condos on the upper 18 floors.

Toll has not yet filed plans for the 23rd Street property with the Department of Buildings, a review of records shows.

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