New York University pays $122M to JPMorgan Chase for office in Downtown Brooklyn

3 Metrotech Center (Credit - Google)

New York University through the entity New York University paid $122 million to JPMorgan Chase for the office building (O6) at 3 Metrotech Center in Downtown Brooklyn, Brooklyn.
The deal closed on August 31, 2022 and was recorded on September 14, 2022. The property has 457,966 square feet of built space according to PincusCo analysis of city data. The sale price per built square foot is $266 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 JPMorgan Chase was Christopher McKenna. The signatory for New York University was Martin S. Dorph.

Prior sales and revenue

Prior to this transaction, Pincusco has no record that the buyer New York University had purchased any other properties and has no record it sold any properties over the past 24 months.
The seller JPMorgan Chase had not purchased any other properties and sold four properties in four transactions for a total of $38.9 million over the same time period. The 457,966-square-foot property generated revenue of $19.5 million or $42 per square foot, according to the most recent income and expense figures.

The property

The 3 Metrotech Center parcel has frontage of 200 feet and is 245 feet deep with a total lot size of 49,122 square feet. The zoning is C6-1A which allows for up to 6 times floor area ratio (FAR) for commercial and up to 2.43 times FAR for residential. The city-designated market value for the property in 2022 is $76.6 million.

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Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property since September of 2020. In addition, according to city public data, the property has received one DOB violation and $5,300 in OATH penalties in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $5 million on this tax lot.

The neighborhood

In Downtown Brooklyn, the bulk, or 40 percent of the 24.3 million square feet of commercial built space are office buildings, with elevator buildings next occupying 25 percent of the space. In sales, Downtown Brooklyn has 3.2 times the average sales volume among other neighborhoods with $1.1 billion in sales volume in the last two years and is the 3rd highest in Brooklyn. For development, Downtown Brooklyn has 3.3 times the average amount of major developments relative to other neighborhoods and is the 5th highest in Brooklyn. It had 3.6 million square feet of commercial and multi-family construction under development in the last two years, which represents 15 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of one of the 19 commercial properties representing 2,736 square feet of the 520,683 square feet. The identified owner is Michaels Organization.
There is one active new building construction project totaling 176,121 square feet. It is a 227-unit, 176,121-square-foot R-2 building developed by Kristina Vagen with plans filed June 25, 2020 and permitted April 28, 2022.

The majority, or 99 percent of the 471,198 square feet of built space are office buildings, with mixed-use buildings next occupying 1 percent of the space.

The seller

The PincusCo database currently indicates that JPMorgan Chase owned at least four commercial properties in New York City with 3,386,373 square feet and a city-determined market value of $1.3 billion. (Market value is typically about 50% of actual value.) Within the portfolio, all identified are office properties. They are all located in Manhattan.

The buyer

The PincusCo database currently indicates that New York University owned at least 198 commercial properties in New York City with 12,735,165 square feet and a city-determined market value of $2.7 billion. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 53 percent of the 12,735,165 square feet of built space are specialty properties, with hotel properties next occupying 39 percent of the space. The bulk, or 95 percent of the built space, is in Manhattan, with Brooklyn next at 5 percent of the space.

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