Sterling Group Pays $20M for Seven Rent-Stabilized Buildings in Sunset Park

The deal includes three four-story brick apartment buildings at 437, 445 and 449 61st Street and four four-story brick buildings on the opposite side of the street at 438, 442, 446 and 450 61st Street. The location is two blocks east of where the Belt Parkway merges with the stretch of Interstate 278 known as the Gowanus Expressway.

Sterling plans to carry out light renovations across the portfolio, according to Marcus & Millichap’s John Brennan, who brokered the deal for both sides along with Rosewood’s Aaron Jungreis, Ben Khakshoor and Alex Fuchs. 

Seven of the units within the portfolio are market-rate and the other 117 are rent-stabilized. At least 60 of those are eligible for rent hikes when they become vacant since the current tenants are paying preferential rent, or less than the law allows, Brennan said.

“It’s a trendy area and close to the subway,” Khakshoor said. “These are older buildings renovated about 15 years ago and in very good shape. The boilers on the roof are in great shape.”

Sterling also liked that all of the buildings are smaller than 25,000 square feet, which means the landlord won’t have to comply with the city’s recently enacted energy efficiency regulations known as Local Law 97, Brennan said.

“These buildings in particular were attractive because there’s no deferred maintenance,” Brennan said. “It’s in an area that’s gentrifying, and these are good, clean buildings from long-term family owners.” 

Members of the Dalmzaio and Hiller family could not immediately be reached for comment. A spokesperson for Sterling did not immediately respond to a request for comment.

Abigail Nehring can be reached at anehring@commercialobserver.com.