1,300-foot tall condo to rise at Drake Hotel site

From left: CIM Group founders Avi Shemesh, Richard Ressler and Shaul Kuba and the Drake Hotel

The site of the former Drake Hotel, recently named the most valuable development lot in the city, will be home to a 1,300-foot tall residential tower, the largest in the city.

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According to the Wall Street Journal, CIM Group, which acquired the site for $305 million last year, and Harry Macklowe plan to erect a slim condominium and retail complex designed by Uruguayan-born architect Rafael Vinoly with 128 units and 12-foot high ceilings. The $1 billion project, at 432 Park Avenue near 56th Street, includes a 5,000-square-foot driveway, golf training facilities and private dining and screening rooms. Macklowe has no equity in the project but has remained involved in the decision making.

Though financing hasn’t been secured and there’s no scheduled completion date, CIM is confident it can get a $700 million construction loan. The private equity firm has $9.5 billion under management, and its Urban Real Estate Fund has an annual return of 7.4 percent compared to a 20 percent annual decline for similar high-risk funds.

It has recently purchased apartment buildings in Dallas, a South Beach hotel, the William Beaver House in the Financial District, a loan backed by the Trump Soho and 11 Madison Avenue. The Journal attributed the spree to the firm’s cautious approach from 2006 to 2008 that left it minimal exposure to inflated property values. Though private equity firms rarely develop ground up, CIM’s partners got their start as developers, the Journal reported. [WSJ]

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