Hornig Capital in contract for $31M South Bronx office building

Purchase seen as another sign that Mott Haven market is heating up

TRD New York /
Nov.November 11, 2014 01:15 PM

A Long Island-based investor is in contract to buy a large office building in a gentrifying area in the South Bronx for $31 million, The Real Deal has learned.

Hornig Capital Partners signed a contract last week in an off-market deal to buy the 175,000-square-foot, Class C office building at 2417 Third Avenue in the borough’s Mott Haven section, a source close to the negotiations confirmed. Madhatters Realty is the seller of the property.

The eight-story building, constructed in 1944, is fully leased to small companies including graphic designers, healthcare-service firms and small manufacturers. Madhatters is also a tenant.

The building sits steps from the Harlem River waterfront in an area that was rezoned in 2005 to allow for residential use in a manufacturing zone. A few years later the owners of a five-story building next door to 2417 Third Avenue received permits to convert that property into 46 rental apartments

Other developments in the area include a planned 84-key hotel on the northern side of the Major Deegan Expressway and the landmarked Clock Tower building, where one-bedrooms rent for about $1,700 a month.

Broker Matthew Green of Bohemia Realty Group regularly shows at the Clock Tower and said the neighborhood is on the upswing.

“Two years ago it was still difficult to bring clients over to Mott Haven,” he said. “They were skeptical and scared. They didn’t know where it was and they thought it was really dangerous.”

“No longer do I have to drag people there,” he added.

Bronx Borough President Ruben Diaz Jr. has also pitched a plan to redevelop a nearby stretch of the waterfront that the city rezoned in 2009 for mixed-use development — a similar idea to Brooklyn Bridge Park. The project calls for $500 million in investment, some 1,500 residential units and 865,000 square feet of commercial space.

Hornig, which could not be immediately reached for comment, was reportedly in contract to buy a $36 million development site in Bushwick earlier this year.

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