New York
The Closing: Hal Fetner
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Fetner buys apartment building for same price as in 2005
BlackRock sells 174-unit property years after scuttled deal with Brearley School
A photo illustration of Fetner Group’s Hal Fetner (left) and Farallon Capital Management’s Richard B. Fried along with 85 East End Avenue (Getty, Fetner Group, Farallon Capital Management, Google Maps)
Hal Fetner quietly scooped up an Upper East Side apartment building from the investment giant BlackRock, according to a Fetner spokesperson and property records posted Friday.
Fetner bought the 15-story, 174-unit luxury rental building at 85 East End Avenue for $75 million. San Francisco-based Farallon Capital Management was in the deal on Fetner’s side. Records show Farallon executive Richard B. Fried signed for the purchase and for a $35 million mortgage that financed it.
A $4 billion Brookfield Asset Management real estate debt fund provided the loan.
A spokesperson for Fetner Properties declined to provide details on the deal. BlackRock, which purchased the building in 2005 from Rudin Management for nearly the same price, $75.2 million, declined to comment.
Doug Middleton and Bill Shanahan at CBRE represented BlackRock.
Built in 1951 between East 83rd and East 84th streets, 85 East End Avenue was the subject of controversy in 2007, when BlackRock signed a contract with the exclusive Brearley School across East 83rd Street.
The New York Post reported at the time that the all-girls school planned to buy part of the building to move students in, which required moving rent-stabilized tenants out.
BlackRock had no easy way to deny the tenants lease renewals, but the school, as an institution “operated exclusively for charitable or educational purposes,” had a path to do that under state law.
However, in such cases the charity must demonstrate a need for the space, which gives tenants leverage.
The renters at 85 East End Avenue hired prominent tenants-rights attorney David Rozenholc to represent them. “The Brearley School abandoned the plan,” Rozenholc recalled in a phone interview. “The tenants were not evicted.”
The school instead targeted another building, also across the street. Those tenants also hired Rozenholc, who negotiated a buyout for them.
“The tenants got a substantial settlement,” the lawyer said. “The Brearley School chose to be a responsible citizen and compensated the citizens appropriately.”
Most of the apartments at 85 East End Avenue appear to have been removed from rent stabilization over the years, through luxury decontrol or by combining units. Both of those routes to the free market have since been closed by the state.
StreetEasy shows no units available at the property and rents ranging from $3,150 for studios to $7,000 for two-bedroom apartments. A five-bedroom there rented seven years ago for $11,500 a month.
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