Joe Chetrit buying Two Bridges site
Developer acquiring 1,300-unit project
Joe Chetrit is heading to Two Bridges.
The developer is buying the development site owned by CIM Group and L+M Development Partners in the rapidly transforming corner of the Lower East Side, sources familiar with the sale told The Real Deal.
The Chetrit Group is in contract to pay around $100 million for the site at 265 South Street, where CIM and L+M filed plans in September for a two-towered building with more than 1,300 units.
Chetrit had been in talks earlier to acquire the site with Michael Stern’s JDS Partners, who is developing a building in the neighborhood at 247 Cherry Street. But those negotiations fell apart and Chetrit went ahead alone.
Chetrit did not immediately respond to a request for comment. Stern declined to comment, as did a representative for the CIM and L+M joint venture.
The deal comes a few months after the state’s highest court declined in May to hear an appeal in a long legal battle over whether a trio of development projects in the neighborhood, including the two above, needed City Council approval. The courts sided with the de Blasio administration in determining that they did not.
Community groups and City Council members claimed the developers needed political approval to modify the Two Bridges large-scale development plan put in place in 1972.
The developments were put on hold in June 2019 when a state judge ruled they had to go through the city’s land use review process, which would have reduced the projects substantially if not killed them altogether. The May ruling paved the way for the towers to move ahead as planned.
The projects will deliver 2,775 apartments to the neighborhood, a quarter of which will be income-restricted.
CIM and L+M’s site has already secured a 421a incentive as the property tax break, now called Affordable New York, is set to expire in June. The property is “likely one of the last buildings approved under the program,” according to marketing materials from Cushman & Wakefield, which brokered the sale with a team led by Adam Spies, Josh King and Dan O’Brien.
A slew of projects across the city are seeking to nail down 421a exemptions by June in case the state legislature cuts the tax break substantially or lets it lapse.
CIM and L+M acquired the development site along with a pair of apartment buildings in 2013 for about $280 million. They sold the buildings last year to the Related Companies for $435 million.
Stern and Chetrit previously teamed up in Brooklyn to develop the 9 DeKalb Avenue supertall tower in Downtown Brooklyn. Stern bought Chetrit out of the project in 2018.
In Florida, the pair partnered to build a megaproject on the Miami River. Stern sold his stake in the project to Chetrit in 2019.
Correction: A previous version of this story said Michael Stern’s JDS Development Group was buying the site with the Chetrit Group. The two companies had been in negotiations to acquire it together, but ultimately the Chetrit Group signed the contract without JDS.