An Upper East Side apartment tower has a buyer, but no answers about its future affordability status.
The real estate management arm of Swiss bank UBS sold the 32-story, 196-unit RiverEast rental tower at 408 East 92nd Street to Ofer Yardeni’s Stonehenge NYC for $115 million, the Commercial Observer reported. UBS was seeking $120 million to $125 million in a sale. https://commercialobserver.com/2023/01/stonehenge-nyc-upper-east-side-apartment-complex-115m/ https://therealdeal.com/2022/09/14/ubs-eyes-125m-for-ues-apartment-tower/
The transaction works out to roughly $587,000 per unit.
Stonehenge bought the 194,000-square-foot property debt-free and is in the market for acquisition financing, a source told the outlet. The building previously traded in 2006 for $95 million when UBS purchased the property from Chicago-based developer the John Buck Company.
An Eastdil Secured team including Gary Phillips and Will Silverman brokered the deal.
As Stonehenge takes ownership of the property, it will have a big decision to make about its future. The building’s affordability agreement, set to expire in 2026, subjects 20 percent of its units to rent stabilization in exchange for the 421a tax abatement.
Stonehenge can choose to let the agreement expire and transition the rent-restricted units to market-rate, or it can exercise an as-of-right 15-year extension of the tax break, which would increase the property up to 25 percent affordability. Market-rate units go for up to $7,000 a month, but affordable apartments are capped at less than $1,000 per month.
Stonehenge did not comment to the outlet on its acquisition.
UBS bought the RiverEast building for $95 million in 2006 from Chicago-based developer the John Buck Company, according to property records previously reported by The Real Deal.
The incoming owner has some background on the area. Stonehenge last year paid about $128 million to buy a 22-story rental building at 354 East 91st Street, a property boasting 163 fully market-rate units. https://therealdeal.com/2022/02/02/stonehenge-nabs-ues-rental-for-130m/
— Holden Walter-Warner