The Real Deal New York

Great Neck firm set to spend $43M on summer retail splurge

Klosed Properties bets on rising rents in hot nabes near South Street Seaport and Times Square
By Rich Bockmann | August 21, 2014 06:20PM

A small retail-acquisition firm out of Great Neck, L.I.’s Persian real estate community had an active summer and is on track to spend $43 million on a handful of properties that it’s betting will command top dollar by the time their leases expire.

Earlier this week, Klosed Properties inked a deal to purchase a retail condo in Soho for $7 million, as the New York Observer reported at the time, and last week the company bought a pair of Properties On Fulton Street near the South Street Seaport for $15 million.

Klosed President Steven Kachanian said the firm is in contract to purchase two more Manhattan properties, and that’s on top of the $13 million the company paid in June in two separate deals for a retail condo in FiDi and a mixed-use property near Times Square.

All in all, Klosed has completed 11 deals this year, including some national triple-net properties.

“We typically do around eight to 12 deals a year,” said Kachanian, who is a distant relative of Zar Poperties’ David Zar. “This has been a particularly good year.”

At 202 Spring Street in SoHo, a Spa Belles nail salon occupies the 2,200 square foot space with a lease set to expire in 2016.

“They’re paying a fraction of where the market is now,” said Kachanian, who added that area rents are in the $250 to $300 per-square-foot range. “We’re confident that in the next two years the market could be in the mid-to-high threes.”

Klosed was repped in the off-market deal by Camelot Realty Group’s David Goldoff, whose father and uncle owned the building.

At 46-50 Fulton Street, Klosed now owns a retail condo and a four-story building sitting on the street that will be bookended by The Fulton Center Mall And The Revitalized South Street Seaport.

The company was represented in that off-market deal by Matt Marshall of the Marshall Real Estate brokerage, who said the largest tenant, a McDonald’s restaurant covering about 5,000 feet, has a lease set to expire in 2020.

“[Klosed] won’t really be able to capitalize on the value there for another five or six years,” he said. “Actually, that may coincide very well with the redevelopment of the Seaport, so the timing for it is pretty good.”

Back in June, the firm partnered with Namdar to buy a retail condo at the base of a 24-story office building at 80 John Street for $7 million, as well as a five-story, mixed-use building at 144 West 46th Street near Times Square. Kachanian said the current tenant, a Chinese restaurant, will vacate soon and the company is looking to bring in an Irish pub for a long-term lease for the building’s 3,000 square foot retail space.

Correction: A previous version of this article incorrectly identified the broker on the 202 Spring Street deal.