The Chetrit Group is seeking to demolish a damaged and structurally compromised Chelsea commercial building at 119-119 West 26th Street, according to lawsuit filed in New York State Supreme Court this week. The Chetrit Group owns the building which suffered a roof collapse in September 2023. The city issued a vacate order for the commercial and an undisclosed number of residential tenants.
Two engineer reports said the building has significant structural problems. Chetrit Group has determined the building should be demolished. On November 8, The city said it would order the building to be repaired, but the Chetrit Group through principal Joseph Chetrit is requesting that no repairs be made, and that the building be demolished.
According to the filing, “it would be illogical to force Plaintiff to make these repairs, as this would only serve as a temporary band aid that will not fully [solve] the problem.” The court case does not assign a monetary value.
The Chetrit Group bought the building in 2005 for $5.5 million.
The office building with residential units in Chelsea has 22,770 square feet of built space and 23,438 square feet of additional air rights for a total buildable of 46,230 square feet according to a PincusCo analysis of city data. The parcel has frontage of 46 feet and is 98 feet deep with a total lot size of 4,623 square feet. The zoning is M1-6 which allows for up to 10 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $3.6 million.
Prior sales and revenue
This property was sold for $5.5 million on February 24, 2005.
The 22,770-square-foot property generated revenue of $716,720 or $31 per square foot, according to the most recent income and expense figures.
Over the past five years, there has been no NYC Department of Buildings new building, demolition, or alteration permit application valued at more than $20,000 filed for this parcel.
Violations and lawsuits
According to city public data, the property has received six DOB violations, $17,375 in ECB penalties, and $19,355 in OATH penalties in the last year.
There were no lawsuits or bankruptcies filed against the property for the past 24 months.
In Chelsea, The bulk, or 36 percent of the 52.4 million square feet of commercial built space are office buildings, with elevator buildings next occupying 28 percent of the space. In sales, Chelsea has the 5th highest sale turnover among other neighborhoods in the city with $2.3 billion in sales volume in the last two years. For development, Chelsea has near average amount of major developments among other neighborhoods and is the 14th highest in Manhattan. It had 2 million square feet of commercial and multi-family construction under development in the last two years, which represents 4 percent of the neighborhood’s built space.
On this tax block, PincusCo has identified the owners of 13 of the 23 commercial properties representing 714,606 square feet of the 1,325,984 square feet. The largest owner is Afiaa, followed by Bert Brander and then Chaim Simkowitz. There are no active new building construction projects on this tax block.
The PincusCo database currently indicates that Chetrit Group owned at least 37 commercial properties with 2,288 residential units in New York City with 4,598,424 square feet and a city-determined market value of $855.4 million. (Market value is typically about 50% of actual value.) The portfolio has $1.6 billion in debt, with top three lenders as Starwood Mortgage Capital, Bank of Montreal, and Starwood Capital Group respectively. Within the portfolio, the bulk, or 49 percent of the 4,598,424 square feet of built space are elevator properties, with office properties next occupying 28 percent of the space. The bulk, or 69 percent of the built space, is in Manhattan, with Queens next at 26 percent of the space.
Within a 400-foot radius of 119 West 26 Street, PincusCo identified eight commercial real estate items of interests occurred over the past 24 months. One of those eight items was a sale which Two Kings Real Estate bought the 64,764-square-foot, one-unit hotel (H2) on 121 West 26th Street for $80.3 million from Watermark Lodging Trust and Watermark Capital Partners on June 28, 2022. Of those eight items, seven were loans above $5 million totaling $81.6 million. The most recent of the seven was Walter & Samuels in which borrowed $5.7 million from Bank of America secured by two condo units in the 8,093-square-foot, 25-unit mixed-use building (RM) on 144 West 27th Street and one other property on August 4, 2023.