Hotel investor pays $23.5M for Garment District condo building

Jaz Patel, one of the principals of hotel-investment company LeTap Group, bought a Garment District condo building for $23.5 million.

The 16-unit walkup, which is located at 319-321 West 38th Street between Eighth and Ninth Avenues, is likely to be replaced by a hotel, according to the Commercial Observer. The property features 54,504 mixed-use buildable square feet.

“This transaction was very complicated given the nature of the assets that were sold and the slew of parties involved,” Massey Knakal Realty Services’ Robert Knakal said. “Selling a cooperative would have been much easier. Given escalating land values, we expect to see several more of these transactions in the coming months.”

Knakal and colleagues David Kalish and Jonathan Hageman represented the 16 condo owners in the transaction. No other brokers were involved in the deal.

Eleven of the units were operated as rentals, and all of the leases expire before the end of 2015, according to marketing materials.

Optima Real Estate is developing a 21-story hotel tower nearby at 333 West 38th Street. The Lightstone Group is mulling a hotel conversion after purchasing a Garment District property earlier this month for $200 million. [NYO]  — Tess Hofmann