Empire Capital lists noisy Coda Williamsburg hotel for $35M

Following a string of splashy deals in Manhattan, Josh Rahmani and Ebi Khalili are putting one of their earliest acquisitions back on the market for nearly twice what they paid for it seven years ago.

Rahmani and Khalili’s Empire Capital, which has emerged as one of the city’s most prolific office investors during the pandemic, is seeking to get about $35 million for the 64-key Coda Williamsburg hotel at 160 North 12th Street in the Brooklyn neighborhood, according to marketing materials.

Empire Capital bought the property, then known as the McCarren Hotel, for $20 million in 2016 from Wheelock Street Capital and Ed Scheetz’s King & Grove. The sale was among the first notable deals for Rahmani and Khalili, who previously made their names running the investment sales brokerage Venture Capital Properties. 

Eastdil Secured is marketing the property for Empire Capital, which recently spent $5 million renovating the property. 

Trendy, boutique hotels in the city have enjoyed resurgent demand in recent months. In February, Standard International paid $107 million, or a post-pandemic record $1.1 million per room, for the Sixty Soho hotel in Lower Manhattan. 

The Coda Williamsburg listing comes shortly after the nearby Williamsburg Hotel sold in a bankruptcy auction for $96 million, or about $650,000 per key.

A popular hangout for millennials, Coda Williamsburg is known for its rooftop pool and nightclub and has been the subject of numerous complaints from neighbors over noise and late-night parties.

In 2019, Localize.city found that the property generated the second most 311 noise complaints of any hotel in the city between 2017 and 2018. At a community board meeting earlier this year, several residents asked the board not to renew the hotel’s liquor license, according to the local news outlet Greenpointers.

The hotel is listed as unencumbered by brand or management, allowing a buyer to come in with a brand of its choosing. It is also non-union.

In March of last year, Empire Capital secured a $15.6 million loan on the hotel from Thorofare Capital. The loan was assigned to Pacific Premier Bank in November, according to property records.

Rahmani and Khalili, who are cousins in their late 30s, have been on a buying spree in Manhattan since 2021, frequently partnering with investors based out of Great Neck, including Igal Namdar and members of the Hakimian family.

Late last year, Rahmani and Khalili’s Empire Capital was part of a group that spent $325 million to acquire an office tower at 1330 Sixth Avenue from RXR and Blackstone. In March, Empire agreed to buy a 20-story office and retail building at 529 Fifth Avenue from Silverstein for $105 million. And earlier this month, Empire closed on its $100 million purchase of the 162-unit rental portion of the Mercedes House in Hell’s Kitchen from Invesco.