A relic of the boom-time era—the sale of buildings in bundles, like cigarettes in a pack, or strips malls in Florida—has reemerged for a brief cameo.
In December, Massey Knakal sold a portfolio of nine apartment buildings in Upper Manhattan for $26.9 million, which, aside from a Sam Chang portfolio of hotels sold to his buddies at Rhode Island’s Magna Hospitality, was both the largest portfolio sale of 2009 and the largest sale of any kind in Upper Manhattan, according to analysts at Real Capital Analytics and the brokerage.
The nine apartment buildings, containing 237 units, are: 125-127 East 118th Street; 149 East 118th Street; 121 East 119th Street; 125 East 119th Street; 166 East 119th Street; 158 East 119th Street; 212 East 119th Street; 135 East 122nd Street; and 2010 Lexington Avenue.
Mind you, the sale of the buildings as a portfolio does not indicate some sort of re-emerging trend, à la the Pinnacle or Praedium days of yore.
“This had to be sold as a portfolio because it was under Section 8,” said Massey Knakal’s Mike Tortorici, who, with brokerage partner Shimon Shkury, represented the sellers, the Seattle-based Security Properties. “When commercial MBS was available, it was easier for people to package together loans and assemble large pieces of real estate. Now, it’s much easier for banks to finance smaller buildings, much as it’s easier for buyers to swallow smaller buildings.”
Francine Kellman, associate director of buyer Pacific Housing Advisers, described the firm’s plans thusly: “We certainly plan on keeping the property affordable for the next 30 years and most likely longer than that. We are doing over $40,000 a unit in rehab, including all major systems, work in apartments, social services, laundry rooms, new management office, etc.”
“My motto is, ‘Today’s preservation is tomorrow’s revitalization.’”