A modest six-story mixed-use building in Tribeca four blocks north of the World Trade Center site is on the market for $21.5 million, or $1,400 per square foot.
The purchase price in February? An even $12 million.
The hoped-for increase in value at 67 Murray Street, located between West Broadway and Greenwich Street, comes after a Korean barbeque restaurant signed a pricey lease for the retail space on the ground floor, basement and sub-basement.
The New Jersey-based company that purchased the 12,300-square-foot building nine months ago hired a retail leasing team at Newmark Grubb Knight Frank, which signed Gunbae for about $200 per square foot, industry sources said. NGKF’s Jay Gilbert and Jansen Hafen represented the landlord at 67 Murray, and Dakota Petito of Concrete Realty represented the tenant in the 15-year deal.
That rent of about $500,000 per year is supporting the bulk of the increase in value, sources said. Taking advantage of the new lease, the owners of 67 Murray hired Nick Petkoff, president of Better Brokers to market the space for $21.5 million.
“The owners added significant value by finding a solid retail tenant paying great rent,” Petkoff said.
Recent retail leases in Tribeca have shown the area’s sharp appreciation in rents. Fresh drink purveyor Juice Press signed a lease for about $152 per square foot at 83 Murray Street in 2013. More recently, Starbucks signed a renewal deal for about $240 per foot at 99 West Broadway. Those prices, provided to TRD by a source active in the area, are unconfirmed.
Petito said when he began looking for space in the area with Gunbae about two years ago, rents were closer to $125 per foot.
“This part of Tribeca is arguably the most underserved in food and beverage — it’s one of the most underserved neighborhoods in the city,” said Gilbert. The opening of 1 World Trade Center and the overall leasing activity in Lower Manhattan are driving the retail push.
In addition to the sharp rise in prices, another element distinguished the neighborhood — the rents on the side streets like Murray were not much different than West Broadway, Gilbert said.
“It is a condensed neighborhood,” he said, and residents, office workers and tourists will wander in a way that they won’t in a clearly-defined strip like Fifth Avenue or Madison Avenue.