Four Winds pays Morgenstern Capital, H.I.G., $68M for 110-unit rental The Knox in Murray Hill

UPDATED 2:05 p.m., May 24, 2024: Four Winds Real Estate and the Lerner Family through the entity 47 East 34th Street Owners LLC (and another) paid $68 million to Morgenstern Capital and H.I.G. Capital through the entity 47 East 34 Owner LLC for the 110-unit rental building The Knox at 47 East 34th Street in Murray Hill, Manhattan.
The deal closed on May 21, 2024 and was recorded on May 24, 2024. The contract date was January 24, 2024.
The signatory for the sellers was Robert Morgenstern, and for the buyers was David Schneiderman of Four Winds.

The Commercial Observer first reported the sale, identifying Eastdil Secured’s Gary Phillips, Will Silverman and Jeff Organisciak as the brokers the deal.

The property

The elevator building with 110 residential units in Murray Hill has 106,153 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 50 feet and is 98 feet deep with a total lot size of 4,938 square feet. The zoning is C5-2 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 city-designated market value for the property in 2022 is $32.5 million. The most recent loan totaled $50.2 million and was provided by Square Mile Capital Management on October 14, 2022.

Prior sales and revenue

This property was sold for $80 million on September 26, 2017.

The 106,153-square-foot property generated revenue of $4.9 million or $47 per square foot, according to the most recent income and expense figures.

Development

Gail Seekins of CIM Group LLC submitted a new building construction project for a 110-unit residential (J-2) building at 47 East 34 Street. The plan was filed on January 27, 2006 and was permitted on January 11, 2008. It calls for the construction of a 450-foot tall, 36-story building and was filed with the New York City Department of Buildings under job number 104339930.

Violations and lawsuits

According to city public data, the property has received $625 in ECB penalties and $1,675 in OATH penalties in the last year.

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

The block

On this tax block, PincusCo has identified the owners of four of the 10 commercial properties representing 197,657 square feet of the 278,829 square feet. The largest owner is Community Church Of New York, followed by Hilson Management Corp. and then Morgenstern Capital. There are no active new building construction projects on this tax block.

The owner

The PincusCo database currently indicates that Morgenstern Capital owned at least two commercial properties with 128 residential units in New York City with 131,930 square feet and a city-determined market value of $37.6 million. (Market value is typically about 50% of actual value.) The portfolio has $50.2 million in debt, borrowed from Square Mile Capital Management and Maverick Real Estate Partners. Within the portfolio, all identified are elevator properties. The bulk, or 80 percent of the built space, is in Manhattan, with Brooklyn next at 20 percent of the space.

The owners according to the Department of Housing Preservation and Development includes Jonathan Vayner, head officer and Kendall Pelzer, agent. The business entities are Canvas Property Group and 47 East 34 Owners Llc.

The surrounding

Within a 400-foot radius of 47 East 34 Street, PincusCo identified three commercial real estate items of interests occurred over the past 24 months. One of those three items was a sale which Republic of Serbia bought the 7,491-square-foot, one-unit industrial (P5) on 22 East 35th Street for $7.9 million from Collectors Club on January 3, 2023. Of those three items, two were loans above $5 million totaling $26.2 million. The most recent of the two was GFP Real Estate in which borrowed $16 million from Apple Bank for Savings secured by the 113,182-square-foot, nine-unit rental (C7) on 175 Madison Avenue and one other property on March 10, 2023.

Correction: The post was updated to correct the neighborhood from Grand Central to Murray Hill, and add H.I.G. Capital as a seller and the brokers.

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