Adams & Company pays $28.1M to Rockrose for minority stakes in Flatiron District office building

Adams & Company through the entity 44 West 18th Street LLC paid $28.1 million to Rockrose Development through the entity Chequessett Owner L.L.C. (and others) for three stakes totaling 12.9 percent in the office building (O6) at 44 West 18th Street, also known as 47 West 17th Street in the Flatiron District, Manhattan.
Owners have bought and sold stakes in the buildings for decades, then in 2019 Rockrose bought a stake for $10.06 million and later other stakes totaling 12.9 percent. This transaction represents Rockrose selling the stakes to affiliates of Adams & Company, which has owned and managed the building since at least 1970 but likely much longer through founding Field and Rosenthal families.
The deal closed on July 20, 2023 and was recorded on July 25, 2023. The property has 179,186 square feet of built space according to a PincusCo analysis of city data.
The signatory for Rockrose Development was Edward H. Traum. The signatory for Adams & Company was David Levy. This is the sale of a 12.9% TIC interest.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Adams & Company purchased three properties in three transactions for a total of $27.2 million and sold one property in one transaction for a total of $148.2 million over the past 24 months.
The seller Rockrose Development purchased 10 properties in six transactions for a total of $334 million and had not sold any properties over the same time period. The 179,186-square-foot property generated revenue of $8.8 million or $49 per square foot, according to the most recent income and expense figures.

The property

The office building in Flatiron District has 179,186 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 78 feet and is 184 feet deep with a total lot size of 14,478 square feet. The zoning is C6-4A which allows for up to 10 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The property is in the Ladies’ Mile Historic District. The city-designated market value for the property in 2022 is $32.9 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property for the past 24 months. In addition, according to city public data, the property has received one DOB violation and $1,580 in OATH penalties in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The neighborhood

In Flatiron District, The majority, or 71 percent of the 23.2 million square feet of commercial built space are office buildings, with elevator buildings next occupying 15 percent of the space. In sales, Flatiron District has 3.9 times the average sales volume among other neighborhoods with $1.4 billion in sales volume in the last two years and is the 9th highest in Manhattan. For development, Flatiron District has 2.4 times the average amount of major developments relative to other neighborhoods and is the 15th highest in Manhattan. It had 2.5 million square feet of commercial and multi-family construction under development in the last two years, which represents 11 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of 12 of the 23 commercial properties representing 681,052 square feet of the 1,197,867 square feet. The largest owner is Solil Management, followed by Norman Kurlan and then Moinian Group.
On the tax block, there were five new building construction projects totaling 170,492 square feet. The largest is a 53-unit, 90,478 square-foot residential (R-2) building submitted by Toll Brothers and filed by Clark Joseph with plans filed April 18, 2014 and permitted January 21, 2015. The second largest is a 13-unit, 23,384 square-foot residential (R-2) building submitted by Gary Vinbaytel with plans filed February 14, 2020 and permitted March 15, 2022.

The majority, or 81 percent of the 1.2 million square feet of built space are office buildings, with elevator buildings next occupying 13 percent of the space.

The seller

The PincusCo database currently indicates that Rockrose Development owned at least 31 commercial properties with 5,561 residential units in New York City with 6,286,857 square feet and a city-determined market value of $1.6 billion. (Market value is typically about 50% of actual value.) The portfolio has $1.7 billion in debt, with top three lenders as Wells Fargo, MetLife, and Deutsche Pfandbriefbank respectively. Within the portfolio, the bulk, or 72 percent of the 6,286,857 square feet of built space are elevator properties, with D4 properties next occupying 14 percent of the space. The bulk, or 43 percent of the built space, is in Manhattan, with Queens next at 37 percent of the space.

The buyer

The PincusCo database currently indicates that Adams & Company owned at least six commercial properties in New York City with 1,476,669 square feet and a city-determined market value of $357.3 million. (Market value is typically about 50% of actual value.) The portfolio has $30 million in debt, borrowed from Lincoln Life & Annuity Company of New York. Within the portfolio, all identified are office properties. They are all located in Manhattan.

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