Successful Sale of 53rd & Second Portfolio in Midtown East, Manhattan
Bob Knakal successfully closed the sale of the 53rd & Second Portfolio, a mixed-use development site assembled from several properties at the southeast corner of 53rd Street and Second Avenue. The properties were owned by separate parties, each with its own set of challenges and intricacies. Despite the complexities, Bob’s persistence and expertise led to a final sale price of $40,000,000, well above what the individual buildings could have garnered on their own.
Sale Details
The final deal saw the developer acquire multiple properties, including the rights to airspace and the valuable retail space beneath the to-be-built structure. Bob’s approach included negotiation with reluctant sellers, such as the owner of the Eamonn Doran bar and the Gasnick Plumbing Supply store, who had an interesting historical feature: a stream running beneath their building.
After years of strategic negotiations and overcoming obstacles like rent-controlled tenants and complicated city records, the deal was successfully closed.
Sale Price: $40,000,000
Seller: Judith Margulies, JM Equities & Others
Buyer: Macklowe Properties
Seller Type: High Net-Worth Individuals (HNWI)
Property Type: Development, Mixed-Use, Portfolio
Sale Date: June 5, 1997
Property Details
The 53rd & Second Portfolio was a prime development opportunity, located in a bustling Midtown East neighborhood. The seller, Judith Margulies of JM Equities, sought to assemble a larger development site that would yield a higher price for the properties, but the project was not without its challenges.
One of the properties, a former home to the iconic Irish bar Eamonn Doran, was a reluctant seller, while another, the Gasnick Plumbing Supply store, contained a running stream underneath its sub-cellar.
The Gasnicks, having operated their business in the neighborhood since 1912, shared that they occasionally went fishing in the stream, creating an interesting dynamic in the negotiations.
Despite these challenges, Bob Knakal’s strategy involved not only negotiating with the individual property owners but also leveraging air rights and creatively resolving complications with lease agreements, ultimately achieving the best possible price for the seller.
Full Address: Southeast Corner of 53rd Street & Second Avenue, New York, NY 10022 (992-996 Second Avenue, 998 Second Avenue, 1000-02 Second Avenue, 308-310 East 53th Street)
Zoning: Development, Mixed-Use
Property Type: Development Site, Mixed-Use
Sale Price: $40,000,000
The Client: A Visionary Business Owner Seeking Expert Real Estate Guidance
Judith Margulies, representing JM Equities, was in charge of a portfolio of properties in Midtown East. The seller sought Bob Knakal’s expertise after realizing the potential to increase the value of their holdings through strategic assembly.
Through Bob’s insight and ongoing communication, the sellers were able to navigate the various challenges, such as securing buyouts for rent-controlled tenants and negotiating with the various parties involved.
The first acquisition took place in 1997, and the assemblage was completed in 2001. In total, the developer paid about $40 million for all of the component buildings and air-rights, far surpassing the value the properties would have achieved individually.
Market Strategy and Leverage
Bob’s approach involved negotiating with each property owner and creating a marketable development package that would maximize value. He used a blend of market knowledge, negotiation skills, and creative problem-solving to secure a successful outcome.
Key to this process was Bob’s ability to negotiate air rights and navigate complex ownership structures.
The competitive nature of the Midtown East real estate market, combined with Bob’s deep market knowledge, allowed for a successful and profitable sale.
Neighborhood Overview
Midtown East is one of Manhattan’s most desirable locations, home to:
- Iconic landmarks like the Chrysler Building and Grand Central Terminal
- High-demand office and mixed-use developments
- Vibrant retail environments and strong demand for commercial spaces
The sale of the 53rd & Second Portfolio attracted significant interest due to its prime location and the opportunity for large-scale development.
Conclusion
The sale of the 53rd & Second Portfolio is a prime example of Bob Knakal’s exceptional ability to guide complex real estate deals to successful conclusions. Through strategic thinking and proactive negotiations, Bob helped his clients achieve a sale price that exceeded expectations.
His expertise in navigating difficult negotiations, such as acquiring air rights and overcoming tenant challenges, made the deal possible.
Testimonial
“Bob Knakal & Paul Massey were the only brokers who could have done this complicated deal for us. They hit the ball out of the park for us with flawless execution.”
– Judith Margulies, JM Equities
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