Stonehenge Acquires Mixed-Use NYC Asset for $33.8M
- Feb 22, 2012
February 22, 2012
By Barbra Murray, Contributing Editor
One month after closing the joint venture acquisition of a seven-property multifamily and retail portfolio with SL Green Realty Corp., Stonehenge has snapped up another mixed-use asset. The real estate company recently purchased the building at 364 W. 18th St., from Fortuna Realty Group for $33.8 million.
Also known as 112 Ninth Avenue, 364 W. 18th last traded hands in 2007 when Fortuna acquired the six-story building for approximately $31.4 million. The property, developed in 1939, features 64 apartments and 57,000 square feet of retail space taking the shape of eight storefronts.
A bevy of investors took a strong interest in the asset, according to real estate services firm Eastern Consolidated, which spearheaded the marketing effort and represented the seller in the transaction. Location — the property is practically a stone’s throw from the bustling West Chelsea and Meatpacking submarkets — served as a powerful magnet. “When you offer a property for sale whose neighbors include the Chelsea Market, Chelsea Piers, Google’s New York headquarters, the Frank Gehry-designed IAC headquarters, and proximity to the High Line, investors are going to take notice,” Brian Ezratty, vice chairman with Eastern, said.
The upside potential at 364 W. 18th also added to the attraction. The retail tenants have termination clauses and the market-rate residential units provide the opportunity for higher rental income as the Manhattan apartment market continues to boom. According to a forecast by Marcus & Millichap Real Estate Investment Services Inc., asking rents will rise an estimated 6 percent in 2012 and effective rents will increase 7 percent. Additionally, as noted in the report, “As homeownership remains out of reach for nearly 80 percent of households in the city, demand for apartments will remain healthy.”
With a city full of renters at its doorstep, Stonehenge is preparing to reposition 364 W. 18th. The company will invest in capital improvements to the residential units and reposition the retail, tying it all together with a new name. The property will be known as Stonehenge 18.