Related Puts $150 Million-Plus Retail Portfolio on the Market
Daniel Geiger Sept. 10, 2012, 3:13 p.m.
The Related Companies is selling a portfolio of three retail buildings that could trade for more than $150 million.
Bob Knakal, chairman of the brokerage company Massey Knakal, is leading a team from his company in marketing the properties, 1110 Third Avenue, a roughly 35,000-square-foot retail condo, 1511 Third Avenue, a stand alone retail building about 60,000 square feet in size and 1429 Second Avenue, another retail condo that is about 50,000 square feet.
Reached by phone in his office, Mr. Knakal did say he was managing the sale of the assets but declined to give details of the listing.
1110 Third Avenue is the retail address in a condo building Related developed at the corner of 65th Street and Third Avenue called The Chatham and is filled by a Pier 1 furniture store, which leased the space in March.
1511 Third Avenue is a retail building whose base floors are occupied by The Gap.
1429 Second Avenue is the avenue address for the retail at 255 East 74th Street, a large glass residential tower that was developed in recent years by the World-Wide Group. The company sold the retail condo to Related for $25 million in 2010. Related subsequently installed an Equinox, a luxury fitness club chain it owns.
Leases in the portfolio run for years, making the offering a stabalized investment suited for an investor looking for a steady return.
The properties come just a few months after Vornado Realty Trust, another large retail owner in the city, sold a slightly smaller portfolio of retail properties to the investor Steve Elghanyan for $80 million and after a number of more recent lucrative retail transactions such as Vornado’s acquisition of the retail space at 680 Madison Avenue for a whopping $280 million that have demonstrated the soaring value of retail space in the city. It’s not clear what Related would do with the proceeds of its sale and if it is planning such ambitious acquisitions as Vornado has made in recent months.
The offering comes just days after Related announced a changing of the guard within its upper management. On Friday, Steve Ross, the company’s founder and top executive said in a statement issued by the company that Jeff Blau, long his number two, would be elevated to CEO. Other top executives were promoted in lockstep with Mr. Blau’s move; Bruce Beal became president and Kenneth Wong advanced to chief operating officer. Mr. Ross who is 72, stated he would remain focused on the West Side rail yards, a multibillion dollar project on 26-acres on the far West Side of Manhattan where he has been trying to find commercial anchor tenants who will provide the financial footing to begin the massive development.