Extell sells 673-unit hotel dev site for $172.8M to Riu Hotels

Gary Barnett’s Extell Development sold a development site in Midtown West with plans for a 673-unit, 578-foot tall hotel tower at 1710 Broadway at the corner of 54th Street, to the global, Spain-based hotel chain Riu Hotels & Development. The sale closed October 5, after going into contract on July 31, 2023, according to the filings.

A spokesperson for Riu confirmed the purchase and said the firm planned 673 units, though the current Department of Buildings plans indicate 670 units. As of publication, this sale had not yet been recorded in public records.

A company called Broadway PT 1710 LLC was formed on August 1, 2023, and registered at 305 West 46th Street, which is the address of Hotel Riu Plaza New York Times Square, one of two hotels in New York City owned by the Spanish hotel company Riu Hotels. Extell Development did not immediately respond to a request for comment.

According to the TASE filing, Extell Development owns an 82.12 percent stake in the development site. It first acquired a 39-percent stake in the property from Cohen Equities in 2015, in a $168 million transaction, according to city records and news reports, and later acquired a larger stake. It is unclear who owned the other 17.88 percent stake.

The sale netted Extell Development $49.6 million after paying off a $112.4 million loan and giving the partner its share.

Extell initially filed plans in 2021 for the project under job number M00486337, but withdrew those plans and refiled substantially similar plans this year under job number M00903689.

David Rothstein of Extell Development submitted a new building construction project for a 670-unit, 241,346 square-foot 70 building at 1710 Broadway in Midtown West, Manhattan. The plan was filed with the New York City Department of Buildings on September 22, 2023 under job number M00903689. It calls for the construction of a 54-story building. The project is described in the filing as: construction of new building. application #m00486337-i1 refiled to comply with bc 2022. kindly request review from development hub.

The property

The office building in Midtown West has 52,150 square feet of built space and 36,361 square feet of additional air rights for a total buildable of 88,470 square feet according to a PincusCo analysis of city data. The parcel has frontage of 129 feet and is 86 feet deep with a total lot size of 8,847 square feet. The lot is irregular. The zoning is C6-7 which allows for up to 15 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $19.2 million.

Prior sales and revenue

This property was sold for $268.1 million on January 5, 2017.

The 52,150-square-foot property generated revenue of $3.6 million or $69 per square foot, according to the most recent income and expense figures.

Development

David Rothstein of Extell Development submitted a new building construction project for a 670-unit, 241,346 square-foot 70 building at 1710 Broadway. The plan was filed on September 22, 2023. It calls for the construction of a 578-foot tall, 54-story building and was filed with the New York City Department of Buildings under job number M00903689. The architect is SLCE Architects. The project is described in the filing as: construction of new building. Application #m00486337-i1 refiled to comply with BC 2022. Kindly request review from development HUB.

Violations and lawsuits

According to city public data, the property has received 11 DOB violations and $350 in OATH penalties in the last year.

There were no lawsuits or bankruptcies filed against the property for the past 24 months.

The neighborhood

In Midtown West, The majority, or 75 percent of the 75.9 million square feet of commercial built space are office buildings, with hotel buildings next occupying 14 percent of the space. In sales, Midtown West has the 3rd highest sale turnover among other neighborhoods in the city with $2.8 billion in sales volume in the last two years. For development, Midtown West is the 2nd most active neighborhood among other neighborhoods. It had 18.3 million square feet of commercial and multi-family construction under development in the last two years, which represents 24 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of five of the 11 commercial properties representing 1,041,390 square feet of the 1,327,970 square feet. The largest owner is Dream Hotel Group, followed by Extell Development and then Madison Equities. On the tax block, there were five new building construction projects totaling 990,663 square feet. The largest is a 670-unit, 241,346 square-foot 70 building submitted by David Rothstein with plans filed September 22, 2023 and it has not been permitted yet.

The owner

The PincusCo database currently indicates that Extell Development owned at least 66 commercial properties with 793 residential units in New York City with 2,882,560 square feet and a city-determined market value of $767.8 million. (Market value is typically about 50% of actual value.) The portfolio has $5.5 billion in debt, with top three lenders as Guggenheim Partners, Blackstone Group, and Prudential Credit Opportunities respectively. Within the portfolio, the bulk, or 37 percent of the 2,882,560 square feet of built space are specialty properties, with elevator properties next occupying 28 percent of the space. The bulk, or 96 percent of the built space, is in Manhattan, with Brooklyn next at 4 percent of the space.

The surrounding

Within a 400-foot radius of 1720 Broadway, PincusCo identified five commercial real estate items of interests occurred over the past 24 months. One of those five items was a sale which Son Dinh Tran bought the 85,309-square-foot, 59-unit rental (D7) on 841 7th Avenue for $36.5 million from Cammeby’s International Group on September 18, 2023. Of those five items, four were loans above $5 million totaling $151.2 million. The most recent of the four was Son Dinh Tran in which borrowed $37.7 million from Ready Capital secured by the 85,309-square-foot, 59-unit rental (D7) on 841 7th Avenue on September 18, 2023.

Direct link to the property’s ACRIS page and link to DOB NOW portal.