Owner/developer Sherwood Equities and Long Wharf Real Estate Partners LLC have sold a 26,000 s/f parcel of vacant land at the southern end of Hudson Yards to the McCourt Group, headed by former Los Angeles Dodgers owner Frank McCourt, for $167.3 million, after acquiring it for $43.5 million in 2011. The deal was an off-market transaction involving no brokers.
The property is located at Tenth Ave. and West 30th St. (360 Tenth Ave.), next to the Spur at the High Line Park. The zoning for the property is mixed-use, allowing for both commercial and residential uses. The base as-of-right floor area ratio of the property is 296,000 s/f. McCourt Group will have an opportunity to purchase an additional 436,000 s/f from the city for a total development of 733,000 s/f, of which 494,000 s/f would have to be devoted to commercial development under existing zoning. The remainder could be residential.
"We're extremely bullish on the immediate area and are currently in planning for projects on our other two sites in the Hudson Yards, which together comprise over two million s/f. We are also currently in negotiations to acquire another site in this district," said Sherwood president and CEO Jeffrey Katz.
"We began investing in this area over 25 years ago and it is finally now in the moment where it is all coming together at a scale that has never been imagined, even in the city of New York," said Katz.
Sherwood Equities is currently developing a high-end condominium project directly adjacent to the High Line, on a full block front, at 500 West 21st St. in West Chelsea. The firm is scheduled to begin sales for the new residence this winter at a separately constructed 4,000 s/f sales gallery.
"As was the case with two of our other recent acquisitions in the area, when we acquired the site, we perceived that the discount for the property was way out of proportion for what it should have been. In essence, it was really a double-discount, due to the real estate downturn while the area was also still emerging," said Sherwood senior vice president of acquisitions and development Ryan Nelson. "We, along with our partners at Long Wharf, were able to execute at this price, in part because we aggressively closed on the transaction in only seven days from the time of offer acceptance to the time of closing."
Long Wharf made the investment on behalf of a fund it manages for institutional investors.
"We spent a great deal of time working with Sherwood trying to acquire this site from the bank, and when the opportunity arose we moved very quickly," said Philip Murphy, director of acquisitions at Long Wharf Real Estate Partners. "We felt there was a tremendous amount of intrinsic value in the land based on what was transpiring immediately around the site and, more importantly, what was about to happen in terms of both commercial and residential development."
Long Wharf Real Estate Partners is a private equity real estate manager. Long Wharf's team has been making value-added investments in sectors and markets across the U.S. for over 18 years, principally on behalf of institutional clients, including corporate and public pension funds, endowments and foundations.
Sherwood Equities is a privately held real estate investment and development company established in 1952. Long known for its contribution to the development of Times Square, Sherwood has become a major player in the High Line and Hudson Yards area, as well as other parts of Manhattan. In addition to owning, developing or managing some of Manhattan's most prominent properties, such as 2 Times Square, 1 Times Square (where the ball falls on New Year's Eve) and 1600 Broadway, Sherwood is currently expanding its acquisition and development pipeline throughout the city.

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09/03/13 Tags: