As building owners and activists debate the financial health of the city’s rent-stabilized properties, a portfolio spanning 1.2 million square feet is in contract to sell for a hefty discount.
Sentinel Real Estate is letting go of nearly 1,300 apartments across 24 properties for a sum approaching $180 million, according to sources and documents viewed by The Real Deal.
Sentinel had paid nearly $300 million for the Upper Manhattan, Crown Heights and Brighton Beach buildings before the passage of a controversial 2019 rent law, public records show.
A joint venture of Alma Realty, PH Realty Capital and Rockledge is buying the discounted portfolio, which would be the largest rent-stabilized deal so far this year. Sentinel declined to comment, and the joint venture did not return requests for comment.
Sentinel had purchased the portfolio between 2015 and 2019, when landlords could more easily raise the rents of apartments regulated by the Rent Guidelines Board.
Since new rules curtailed those practices, many rent-stabilized landlords have cited falling property values as evidence of a basic economic problem: Owners are faced with pouring more money into renovating aging units than they can recoup in rents.
Still, buyers see profit in many rent-stabilized properties — albeit at prices far below what they were worth before the law changed.
A report this month from New York City Comptroller Brad Lander disputed landlords’ claims that the 2019 law caused more vacancy or lowered property values, but owners took issue with his methodology and pointed to sales that contradict his conclusions.
For example, BentallGreenOak sold 120 and 125 Riverside Drive to Aya Acquisitions at a 64 percent discount from the last purchase price.
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