Prime Midtown development site hits market without price tag

A prime Midtown East development site at 249-53 East 50th Street has hit the market, with approximately 44,000 buildable square feet and 55 feet of frontage between Second and Third avenues, Ariel Property Advisors, the exclusive listing agent for the property announced today. The site came online this morning with no noted asking price, a spokesperson for the company told The Real Deal, a tactic which some industry experts say brokers are increasingly employing to gauge the market’s interest as the economy continues to fluctuate.

“When they put a price tag on [a site,] they may be undershooting,” said one commercial broker active within the industry, particularly in this economy. “There are standard ways to value a property and then there are more creative ways.” Another commercial agent noted that the absence of a price tag occasionally reflects the unrealistic expectations of a seller, who may overestimate the selling potential of a site.

The property, which was previously listed earlier this year for $13.45 million, currently consists of three adjacent, four-story walk-up residential buildings that contain 12,288 square feet above grade, Ariel said. Zoning allows for ground-floor retail with residential above. The buildings were purchased by the current owner, a private partnership called 249-253 East 50th Development LLC., in 2006. The total purchase price was not immediately available.

Shimon Shkury
, president of Ariel Property Advisors, who listed the property along with Michel Tortorici, Victor Sozio and Jesse Deutch, said the site, which would be delivered vacant, is ideal for condos.

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“Condominium sales in this area continue to trade well above $1,100 per square foot,” he said. “New construction has been extremely scarce in recent years and will ultimately result in a very supply-constrained Manhattan market by the time construction is completed on this site. Because of the offering size, scale, and a location that rarely comes to market, the site stands out as a premier Manhattan development opportunity.”

Shkury said of the absence of a price tag: “The ownership wants to maintain as much flexibility as possible in the marketplace today.”

How does a broker with an interested client approach a listing with little idea of the asking price?

“I would call the listing broker and say, ‘look, what is the figure the owner has in his head?” and we’d work out the economics from there,” an industry insider said. “Is it the most effective way to get the best price? That’s a tough question to answer.”