Slate and Breaking Ground in Talks to Buy Manhattan’s Stewart Hotel

A partnership between multifamily developer-operator Slate Property Group and Breaking Group, an organization that provides permanent supportive housing for individuals in need, is in late-stage talks to acquire Manhattan’s Stewart Hotel from Sioni Group and Patriarch Equities for around $275 million, with plans to convert the property to 535 units of permanent affordable housing.

Slate and Breaking Ground would be co-developers on the project.

The Stewart, at 371 Seventh Avenue on the corner of 31st Street, closed as a working hotel in 2022, and was recently used by the city as a migrant shelter.

Sioni Group and Patriarch Equities, along with Highgate, bought the hotel in 2016, according to The Real Deal, which was first to report the pending sale of the Stewart Hotel. Public records indicate that the 2016 sale was for $212.5 million, and that ownership transferred from 371 Seventh Avenue LLC and Pebblebrook Hotel Trust to Cyh Manhattan. Sioni filed plans in December 2024 to convert the property into a 625-unit residential property. 

Sioni Group did not immediately respond to a request for comment, and Patriarch Equities could not be reached for comment.

In addition to providing housing to the formerly homeless and those at risk of homelessness, Breaking Ground provides services such as benefits assistance, medical care such as substance-use referrals, and self-sufficiency programs that include helping residents build new skills that could lead to employment. 

“We’ve known each other a long time. They were the absolute perfect partner,” said David Schwartz, co-founder and principal at Slate Property Group. “We’re going to do the construction work, and Breaking Ground is going to operate the building and provide all the services.”

Breaking Ground has been converting buildings to permanent supportive housing since 1990, and runs nearly 4,500 units of supportive housing in New York City.  

 “Breaking Ground started by converting the Times Square Hotel on 43rd and Eighth Avenue back in 1990. That’s how we got our start,” said Brenda Rosen, Breaking Ground’s president and CEO, who notes that the Times Square Hotel project is “still the single largest supportive housing residence in the country with 652 units.”

Rosen said that while the organization got its start in Midtown, rising housing prices sent its work out to the boroughs, making this opportunity for such a large conversion in Manhattan that much more special.  

Other properties the group has converted over the years include the Prince George Hotel at 14 East 28th Street in Manhattan into 416 housing units, the Schermerhorn at 160 Schermerhorn Street in Brooklyn into 217 units, and the 90 Sands at 90 Sands Street in Brooklyn into 491 units of permanently affordable, supportive housing.

Details on the new housing units are not available given that the Stewart Hotel deal has not officially closed, but Rosen said that most of the units will be along the lines of efficiency units and studios. 

Schwartz also made clear that while exact rents have yet to be announced, the units will be affordable in the truest sense of the word.

“These will be low rents,” said Schwartz. “These are not ‘affordable, but they’re $3,000 a month’ apartments. Every one of the units is going to have low rent.”

The pair did not reveal details about the project’s financing except to say they were currently in talks with the city and the state, and will require “significant investment” from both for this project to succeed. Schwartz also said he expects the deal to close sometime before the end of the year. 

Both Schwartz and Rosen are optimistic the Stewart Hotel project will be an opportunity to place truly affordable housing where it’s needed most.

“A Midtown Manhattan location like this is really, really rare,” said Rosen. “To have the opportunity to do this many units is game-changing.”

Larry Getlen can be reached at lgetlen@commercialobserver.com.