RXR Acquires Minority Stake in Upper East Side Luxury Rental

Scott Rechler is buying into a luxury rental building on the Upper East Side, as well as a bunch of townhouse units in its vicinity.

RXR acquired a 45 percent stake in 265 East 66th Street and 20 nearby townhouse units, Bloomberg reported. The deal valued the rental properties at $435 million.

Josh Gotlib and Meyer Orbach’s GO Partners paid $425 million for the 295-unit rental and the townhouses in 2023, closing the last part of a big multifamily deal with Stefan Soloviev. It was the final piece of a megadeal Gotlib and Orbach struck to acquire 1,766 multifamily units from the company founded by Soloviev’s father, the late Sheldon Solow, for $1.75 billion.

After GO walked away from one of the properties, the final deal tallied $1.66 billion for about 1,600 units, slightly north of $1 million per apartment. GO is remaining the majority owner of the assets being partially acquired by Rechler.

Newmark’s Adam Spies and Adam Doneger arranged the stake sale.

Tight supply in the rental market is keeping prices elevated for tenants. The monthly rent of available apartments at 265 East 66th Street range from $6,100 for a one-bedroom unit to $12,750 for a three-bedroom unit, according to StreetEasy.

RXR and GO Partners have done plenty of business before, even centering around similar properties.

Last year, RXR offloaded its preferred equity position in One East River Place, and One and Two Sutton Place North in the Upper East Side for $339.5 million to GO Residential Real Estate Investment Trust.

Previously, RXR, the Qatar Investment Authority and Macquarie Capital invested $261 million in the portfolio in 2022, when Gotlib and Orbach’s GO Partners paid $850 million for the three apartment buildings developed by the late Solow.

RXR also participated in the recapitalization of 685 First Avenue.

— Holden Walter-Warner