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Discover 5 East 44th Street, Midtown East, Manhattan—a stunning transformation from a 27-foot-wide office building to a high-value boutique residential condo. Experience the blend of historic charm and modern luxury in this prime location.
Property Highlights: Office to Residential Condo Conversion Cost and Details for 5 East 44th Street
5 East 44th Street, a small office building, was undervalued until we revealed its potential for over 19,000 buildable square feet of unused development rights. This insight led to a successful sale to a developer, who transformed it into a boutique residential condo, achieving a $5.7 million sale price.
- Property Location: 5 East 44th Street, Midtown East between 5th and Madison Avenue. One block west of Grand Central Terminal.
- Property Description: A 27-foot-wide, six-story office building with 16,000 gross square feet, previously occupied by Overseas Courier Service Co. LTD.
- Successful Price Sale: Completed a successful sale to a developer who built a boutique residential condo, selling for $5.7 million in 2003.
- Conversion Strategy: During the meeting, we highlighted the development potential, focusing on converting the property into a hotel or residential condo, contrary to other brokers who missed this.
- Unused Buildable Square Feet: Identified over 19,000 buildable square feet of unused development rights, which was overlooked by other firms due to misconceptions about zoning laws.
- Zoning Insight: Noted that the "sliver law" did not apply in this midtown Manhattan zone, contrary to other brokers' assumptions.
About the 5 East 44th Street Midtown East, Manhattan Location
5 East 44th Street is centrally located in Midtown Manhattan, a dynamic area renowned for its commercial and cultural significance. It is just a short walk to Bryant Park, a lively green space, and the iconic New York Public Library. Times Square, with its theaters, dining, and entertainment options, is also nearby.
5 East 44th Street Office to Residential Condo Conversion Full Story by Bob Knakal
A not-so-obvious development site
Sometimes the key to making a deal is simply understanding the asset.
5 East 44th Street was a small, 27-foot-wide, six-story office building containing about 16,000 gross square feet. The building was owned and occupied by Overseas Courier Service Co. LTD, a Japanese company that was the equivalent of the FedEx of Japan that also operated in the US. This location was their US headquarters.
When OCS decided it was time to sell their building and move to larger quarters, they interviewed three brokerage firms. As is normally the case, we always try to present last as that is generally an advantageous position. The client knows what the other folks have said about the value and in your marketing presentation you may bring up things the others didn’t or forgot to. If you forget something and one of the other firms brings it up, the client is very likely to ask you about it, giving you an opportunity to address the issue.
This was an unusual asset as the width was relatively narrow and the existing building had been occupied by OCS for many years. Many of the buildings of this nature in midtown Manhattan are owner-occupied. The folks who were in charge of the OCS offices in NYC were not the folks who were around when the building was purchased.
When we went into the meeting, we immediately said that the highest and best use of the property was for development. Either a hotel or residential condo would produce the highest land value. The sellers were surprised to hear about the over 19,000 buildable square feet of unused development rights that were sitting on top of the building. The other brokers hadn’t mentioned it. Perhaps it was the narrow width or perhaps they were under the impression the “sliver law” applied, which inhibits the development of lots less than 45’ wide in most Manhattan zoning districts. However, some of the zones in midtown are exempt from this restrictive law. Zoning in NYC can be complicated but this should have been known.
The sellers were impressed and agreed to retain us on the spot. We got the assignment and sold the property to a developer who built a boutique residential condo on the site, utilizing all of the development rights. The deal closed in 2003 and sold at a price of $5.7 million.
Shoki Matsui on How Bob Knakal Revealed Our Property’s True Potential
Here is what the seller had to say:
“We didn’t realize the development potential of our property until we spoke to Bob Knakal. We received much more for our property than we expected, thanks to Bob.” – Shoki Matsui, OCS Co. LTC
Learn More
Discover the stories behind our most remarkable deals. Dive into our exclusive online magazine to explore these Development Site Sales and see how we maximize value and the sale price for our clients. You can also read about the testimonial of the 14 – 16 East 39th Street, Hyatt Centric Hotel in Midtown East.
