Successfully completed the $198.5M sale of the Gray Block Portfolio, consisting of 3 Class B office buildings in the Flatiron and Midtown East submarkets of Manhattan, NYC.
Property Highlights: Office Building Cost and Details for Gray Block Portfolio in Flatiron
We successfully sold a portfolio of 3 Class B office buildings for $198.5 million, despite minimal documentation due to neglected record-keeping and an office fire. Our rigorous due diligence and strategic marketing led to 42 offers and a competitive sale, with the final deal involving a national private equity firm and several partners.
- Inherited Portfolio: A family-owned portfolio of 3 Class B office buildings in Midtown South and Grand Central was left to Einstein College of Medicine after the last surviving member passed away.
- Documentation Challenges: The portfolio had minimal documentation due to years of neglected record-keeping and an office fire that destroyed historical records.
- Due Diligence: Our team conducted extensive due diligence, piecing together the properties' history and current state through inspections and available documents.
- Digital Integration: We utilized a third-party digital platform to organize data and streamline the sale process.
- High Market Interest: The portfolio attracted 42 offers due to its location in popular submarkets, leading to intense interest from the investment community.
- Office Building Sale Price: The portfolio was sold for $198.5 million to a group led by a national private equity firm and several partners, achieving both a high price and full portfolio sale.
About the Gray Block Office Building Portfolio Location
The Gray Block Portfolio is comprised of 3 office buildings located in the Flatiron and Midtown East neighborhoods of Manhattan. Situated in the heart of the city, this portfolio is conveniently within walking distance of landmarks such as the Flatiron Building, Madison Square Park, Bryant Park, and the Empire State Building.
Gray Block Portfolio: 3 Class B Office Buildings Address
- 9 East 38th Street - Office
- 14 East 39th Street - Commercial/Retail
- 912-920 Broadway - Office
Gray Block Portfolio Full Story
No asset documentation… no problem!
A family had owned a portfolio of office buildings for many decades and by the time the surviving member passed away, there were no heirs, so the assets were left to the Einstein College of Medicine. We had worked for the college on a few other assignments and knew the members of the Board very well. Several of them were real estate professionals.
The college wanted to monetize the real estate and we were hired to sell this portfolio of 3 Class B office buildings in Manhattan’s booming Midtown South and Grand Central submarkets, totaling approximately 460,685 rentable square feet.
The properties had been owned by the same family for several generations, whose arms-length management style meant that building upgrades and leasing strategies that could have been implemented to increase the portfolio’s performance had never been undertaken. Additionally, there was no access to documents such as reimbursement schedules, contracts, or even full leases as record keeping in recent years had been neglected due to the unfortunate passing of the owner. Added to that, an office fire years before destroyed a significant amount of the historical documents.
We began with a lengthy and robust due diligence process, in which several associates and analysts poured over each salvageable document and inspected the buildings several times in order to piece together the history and current state of the properties and their operations.
After solidifying the underwriting, we integrated a third-party digital platform to organize our data room and assist in running a smooth process. Given the popularity of the submarkets at the time, the response from the investment community was enormous.
After just a short time on the market and achieving 42 offers, we realized that the best way to achieve a dual mandate – get the highest price and ensure that all 3 buildings were sold – was to push potential investors to purchase the entire portfolio. Many investors were enamored with one or two properties, but few with all of them.
Acknowledging this, investment groups began to group together to purchase the entire portfolio and split up the properties accordingly. Eventually, we secured the sale of the portfolio for $198.5 million to a group led by a national private equity firm coupled with several local and national partners.
Client Experience: Maximizing Value in Repositioning and Marketing Diverse Manhattan Properties
What your fellow property owners have experienced working with us.
"When we needed to select a broker for our sales, we wanted someone who understood the local market but could also access the overseas markets for potential buyers as well. Bob Knakal and his team had done work successfully for us in the past and was a great choice for us. 920 Broadway was an office building in need of repositioning and the 38th/39th Street assets could be upgraded for continued office use, could be converted to hotel, could be considered a development site or a hybrid of these potential uses. Bob and his team exposed these assets to a wide variety of buyer types, advised us constantly throughout the process and, ultimately, produced results we were very happy with. I highly recommend Bob and his team to any seller looking to maximize their sales price.” - Samuel G. Weinberg President/CEO Weinberg Properties & Einstein Board Member
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Discover the stories behind our most remarkable deals. Dive into our exclusive online magazine to explore these success stories and see how we maximize value and the sale price for our clients. You can also read about the testimonial of the Property Co-Op Sale 85 Fifth Avenue Union Square in NYC
