Meadow Partners buys $437M in NYC assets in 2022: acquisitions profile

Meadow Partners, a private equity investment manager with real estate in the United States and Europe, acquired 18 New York City buildings last year through 11 transactions for a total of $437 million. Most of the deals were in partnership with a local operator. The 18 buildings were part of 13 tax lots.

The firm’s dollar volume put it at number 13 in the PincusCo ranking of the top 200 buyers of 2022 in New York City, just behind Memorial Sloan Kettering and just ahead of Dalan Management.

Partners Jeffrey Kaplan and Timothy Yantz lead the investments in New York City for the firm founded in 2009. The company also invests in Washington, D.C, Paris and London.

Kaplan said as the market started to freeze in about May last year, Meadow Partners began looking for rescue capital opportunities.

“Generally we are looking at preferred equity or mezzanine debt, some combination to fill the gap,” he said in an interview earlier this year. “There has not been a ton of it, but I think that is what this year holds.”

“We have a fair amount of dry powder,” to acquire such properties, but the distress deals are slow to happen, he said.

“I feel like borrowers have to go through a cycle of fighting senior lenders, alternative financing, thinking about selling, but not liking the price,” he said.

He said Meadow Partners had not yet closed such as deal, but the firm is working on a number of them.

In terms of acquisitions, Meadow Partners’s biggest New York City purchase last year was an office building in the West Village, accounting for more than half of the acquisition dollars. All the other properties Meadow Partners bought in the city last year were apartment buildings, and most of those were in Manhattan. Of those not in Manhattan, four were in Williamsburg and one was in Park Slope.

Meadow Partners itself was not immune to negative market forces. Last year, it turned over three properties in the city through consensual foreclosures. Two were hotels closed since Covid, and the third was an office building that had WeWork as a tenant.

Of those three foreclosures, the highest value in city records was the Williamsburg office building at 109 South 5th Street, which lender Heitman Capital Management took over, with a $45.97 million transfer value. Next was a hotel at 42 West 35th Street, which sold for $33.9 million, and finally Meadow Partners turned over a leasehold on the other hotel 118 East 40th Street for $15.6 million. They had acquired that leasehold for $44.8 million in 2014.

Acquisitions

The year in acquisitions began small, with Meadow Partners in January closing on a seven-unit rental property in Williamsburg for $4.85 million with partner Aperture Holdings.

Their next move was in the Upper West Side in February, when it paid $6.86 million for a four-unit building in partnership with Davean Holdings. By the end of the year, Meadow and Davean partnered to close on 10 more buildings for $56 million, ranging in transaction price from $4.5 million to $25.5 million. All those rental buildings are more than a century old.

In May, in partnership with DAX Real Estate, the firm paid $5.8 million for a mixed-use walkup in Williamsburg.

Then in June, Meadow closed on its largest purchase of year. It paid Aby Rosen’s RFR Holding $288.2 million for the office building 95 Morton Street in the West Village. This was the most expensive purchase by square foot, at $1,867 per foot, using the city’s measurement of the building.

In June, July and August, Meadow closed on the $56 million in deals with partner Davean Holdings. The average purchase price per foot for those properties ranged between $591 and $1,089, with most of those properties including a retail component.

Later in August, Meadow Partners with 60 Guilders closed on Meadow Partner’s second largest purchase in the city, the 89-unit elevator building at 304-310 East 12th Street in the East Village, for $57.8 million, or $568 per foot and about $650,000 per unit. The seller was a long-time family owner, the Chissicks.

The firm’s last purchase of the year was a pair of Williamsburg walkups with a total of 55 residential units, which closed in October. Meadow Partners paid a combined $17.5 million for 65-75 Roebling Street and 77-83 Roebling Street. The two acquisitions also had the lowest price per foot, at an average of $265, according to PincusCo analysis of city records.