Anonymous buyer pays $35.7M to The Collective for LIC hotel, last sold for $58M

35-02 37th Avenue Paper Factory (Credit - Google)

35-02 37th Avenue Paper Factory (Credit - Google)

An anonymous buyer in care of Jeffrey Zwick & Associates through the entity 37-06 36th Street Holdings LLC paid $35.7 million to The Collective through the entity The Collective Paper Factory LLC for the Paper Factory hotel (H9) at 35-02 37th Avenue in Long Island City, Queens. The Collective bought the property on March 18, 2019, for $58 million.

The deal closed on August 8, 2023 and was recorded on August 14, 2023. The property has 80,200 square feet of built space and 19,800 square feet of additional air rights for a total buildable of 100,000 square feet according to a PincusCo analysis of city data. The sale price per built square foot is $444 and the price per buildable square foot is $356 per the PincusCo analysis. (The price per square foot analysis is the transaction price divided by square feet as reported in public records and assumes no air rights have been sold.)
The signatory for the seller was Reza Merchant.
The purchase was financed through a $29 million loan from Popular Bank. The prior debt was a loan that totaled $39 million and was provided by Argentic Investment Management on April 1, 2021.

The property

The parcel has frontage of 208 feet and is 100 feet deep with a total lot size of 20,000 square feet. The lot is irregular. The zoning is M1-3/R7X which allows for up to 5 times floor area ratio (FAR) for manufacturing and up to 5 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $12.9 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 $650 in OATH penalties in the last year.

The neighborhood

In Long Island City, The bulk, or 32 percent of the 60.1 million square feet of commercial built space are industrial buildings, with elevator buildings next occupying 31 percent of the space. In sales, Long Island City has the 8th highest sale turnover among other neighborhoods in the city with $1.9 billion in sales volume in the last two years. For development, Long Island City is the 4th most active neighborhood among other neighborhoods. It had 8.6 million square feet of commercial and multi-family construction under development in the last two years, which represents 14 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of five of the five commercial properties representing 107,290 square feet of the 107,290 square feet. The two identified owners are John Zirinsky and The Collective.
There are no active new building construction projects on this tax block.

The majority, or 75 percent of the 107,290 square feet of built space are hotel buildings, with industrial buildings next occupying 25 percent of the space.

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