Rego Park Rent-Stabilized Buildings Trade for $48M
By Rebecca Baird-Remba December 8, 2023 4:17 pm
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A large rent-stabilized complex in Rego Park, Queens, has sold for $48 million, according to Marcus & Millichap, which brokered the deal.
The six-story, 312-unit property known as Fannwood Estates traded for $142 per square foot, or $153,846 per unit.
The property also has 183,000 square feet of unused air rights, per Marcus & Millichap. The brick complex at 99-16 66th Avenue occupies an entire block bounded by 66th Avenue, 66th Road, 99th Street and 102nd Street. It also sits just off Queens Boulevard and across 102nd Street from Long Island Jewish Forest Hills hospital.
The seller appears to have been New Hyde Park-based Ditmas Management, and Marcus & Millichap did not disclose the buyer. Ditmas Management, owned by the Goldberg family, has owned the building since at least the 1970s, public records show, but it’s not clear if they were the original developers of the 1939 property.
Marcus & Millichap’s Shaun Riney, Seth Glasser, Joe Koicim, Louis Zarif and Sean Fopeano represented the seller and found the buyer.
Riney explained that the property had been well maintained for decades, which meant it would be easy for a new owner to manage.
“Do you want to buy a fixer-upper, or do you want to buy something that you can just step in and manage correctly?” he asked. “It sold at a very healthy cap rate — low 5 percent basis is very good. Other properties have sold at higher cap rates, but they have significant deferred maintenance. The seller has a scaled property and no violations on 312 units.”
The value of rent-stabilized buildings in New York City has tumbled in the wake of the 2019 rent law, which prevents owners from deregulating units in most circumstances and caps the amount of rent increases that can be priced in by renovations.
Many landlords have taken significant losses on their properties this year, with Barberry Rose Management offloading 16 rent-stabilized buildings in Upper Manhattan for $47 million in September, a 44 percent loss. Taconic Investment Partners and Clarion Partners sold off a 14-building portfolio in the Bronx for $60 million in the spring, taking a 40 percent hit on what had cost them $100 million just five years ago.
Rebecca Baird-Remba can be reached at rbairdremba@commercialobserver.com
