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New York

CL Investment sells one-third stake in Shaoul’s Gramercy Park condo project

Chinese firm scrapped condo conversion at 287 Park Ave. South this fall

Ben Shaoul and 385 First Avenue
Ben Shaoul and 385 First Avenue

UPDATED, Feb. 6, 4:15 p.m.: Chinese development firm CL Investment Group looks to be having second thoughts about New York City’s condo market.

The company, formerly known as Cheerland, sold a 32.9 percent stake in the Luminaire, Magnum Real Estate’s rental-to-condo conversion at 385 First Avenue in Gramercy Park, property records show. Another Chinese investor — Hudson West VI LLC, which has an address in Beijing — looks to have picked up CL Investment’s stake for nearly $33 million.

Magnum [TRDataCustom], led by Ben Shaoul, bought the 138-unit building from Atlanta-based Post Properties in 2014. The $270 million deal included the Luminaire and the Toscana, a 199-unit high-rise at 389 East 89th Street.

Magnum converted both buildings into mid-market condos, with one-bedrooms at the Luminaire starting at $950,000 and two-bedrooms ranging from $1.75 million to $2.73 million.

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CL Investment entered the New York market with a bang in 2014, spending an estimated $800 million on properties including the United Charities office building at 287 Park Avenue South and 555 West End Avenue, Cary Tamarkin’s conversion project on the Upper West Side. Its involvement with Magnum’s Luminaire was not previously known.

In a statement, the firm said it received and accepted an “attractive offer” for a portion of its stake in the Luminaire. “CL continues to have high expectations for the condo market in NYC,” and looks forward to continuing its partnership with Magnum, it said.

In recent months, the Chinese firm appears to have soured on luxury condos in Manhattan amid concerns that the market is saturated.

This past fall, CL Investment canned its $300.2 million luxury condo conversion at 287 PAS, which it will keep as a commercial and office building, representatives said at the time. The conversion would have included 40 apartments, including a $17.5 million penthouse, according to now-withdrawn plans filed with the New York state Attorney General’s office.

Kuafu Properties, another investor with ties to Chinese capital, said last year that it will hold off on condo plans for a site at East 60th Street, which it had bought for $300 million, or more than $1,100 a foot.