The Real Deal New York

Kiska Development looking to sell large Midtown assemblage

Site at East 56th and Lex has 175K sf of development rights
By Rich Bockmann | March 13, 2018 02:15PM

East 56th Street and Lexington Avenue

Kiska Development is looking to sell a large assemblage on Lexington Avenue across the street from where Hines and Welltower are building a 130,000-square-foot senior-housing and medical facility.

Kiska, headed by Turkish developer Kagan Gursel, is actively marketing the development site at the northwest corner of Lexington Avenue and East 56th Street, sources told The Real Deal.

The assemblage holds about 175,000 square feet of development rights, and the area’s zoning allows for residential, office, hotel and medical uses with no height restrictions, sources familiar with the property said.

Kagan, who developed a former condominium building on East 94th Street into the extended stay Marmara-Manhattan hotel, couldn’t be immediately reached for comment.

The owner hired a JLL team of Mo Beler, Glenn Tolchin, Anthony Ledesma and Yoav Oelsner to market the property, with JLL’s Aaron Appel advising on financing.

The brokers couldn’t be reached for comment and it wasn’t clear what the asking price was. But Hines and the assisted-living real estate investment trust Welltower paid roughly $1,030 per square foot when they purchased their development site across the street for $115 million in 2016.

At that pricing, Kiska’s site would fetch around $180 million.

The developer paid a total of $63.53 million over the past eight years to pull the assemblage together.

It started in 2010 when Clarion Partners sold Kiska seven properties at 678-684 Lexington Avenue and 131-135 East 56th Street for $33.86 million, property records show. The next year Kiska picked up a property adjacent to the site at 129 East 56th Street for $3.6 million.

Kiska picked up $4.8 million worth of air rights on the block from Himmel +Meringoff Properties, which also sold 686 Lexington Avenue to the developer in 2014 for $21.25 million.

Hines and Welltower brought in an unidentified JV partner in January on their 16-story development a 139 East 56th Street, which is currently under construction and expected to open in 2020.