34-Year Bronx Leasehold Sells for $18.4M
A 34-year leasehold on a newly constructed two-story retail and office building with a 74-car parking garage in the Morrisania section of the Bronx sold last week for $18.4 million, Commercial Observer has learned.
The 53,705-square-foot building and 24,300-square-foot parking garage is located at 840 Westchester Avenue on the southeast corner of Westchester and Longwood Avenues. The building includes 83,321 square feet of air rights. Existing tenants are Rite Aid, Children’s Health Fund, St. Dominic’s Home and Empire Parking. Their leases expire between 2018 and 2027 and produce a total rental income of $2.1 million, according to the marketing materials.
“The seller is a national company based in California, specializing in commercial real estate assets really more in other areas of the country, midwest, some parts of California, some parts of the south, not New York,” said Ariel Property‘s Scot Hirschfield. “This was their only asset in New York. That’s why they wanted to sell it.”
Mr. Hirschfield represented the seller, an affiliate of national real estate investment firm Columbus Pacific Properties, along with colleagues Victor Sozio, Jason M. Gold and Shimon Shkury. They also procured the buyer, a local investor seeking a 1031 exchange opportunity after selling a multi-family portfolio in the Pelham Bay section.
The seller was “the hard money lender that gave construction loans to the leasehold operator and they basically took back the leasehold from the entity they lent money to,” Mr. Hirschfield said. “In the recession they couldn’t complete construction. The sellers completed construction of it, put in tenants and managed the property.”
The seller secured a $14 million loan on the property last year, Mr. Hirschfield said, and the buyer of the leasehold assumed that loan and will be operating the property as is.