Note holder acquires Union Square dev site from Riese Org. in $11.2M transfer

Debt owner T30 Capital through the entities 34 USQE Owner, LLC and Totowa Beacon USQE LLC, acquired through a deed transfer valued at $11.2 million the retail building (K2) at 34 Union Square East in Gramercy, Manhattan. The seller was the Riese Organization through the entity 34 USE Owner, LLC.
The property has been marketed for sale as a development site for years, at one point in 2018 asking $31 million.
The deal closed on October 21, 2024 and was recorded on October 24, 2024. The property has 6,500 square feet of built space and 26,000 square feet of additional air rights for a total buildable of 32,500 square feet according to a PincusCo analysis of city data. The parcel has frontage of 26 feet and is 125 feet deep with a total lot size of 3,250 square feet. The zoning is C6-4 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 $3.6 million.
The sale price per built square foot is $1,723 and the price per buildable square foot is $345 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 the seller was Dennis Riese. The signatory for the buyer was Margaret Grossman.

T30 Capital through the entity 34 Usqe Owner, LLC bought a note with an original principal of $13.5 million from M&T Bank secured by Riese Organization’s retail building (K2) at 34 Union Square in Gramercy, Manhattan.
Dennis Riese bought the building in November 2009 for $15.3 million, borrowing $13.5 million at the time. T30 Capital bought the debt on October 15, after the sale contract, which was dated August 21, 2024.

The deal closed on October 15, 2024 and was recorded on October 24, 2024. The prior lender was M&T Bank which held debt that had an original loan amount of $13.5 million.

Prior sales and revenue

The 6,500-square-foot property generated revenue of $709,364 or $109 per square foot, according to the most recent income and expense figures.

The property

The retail building in Gramercy has 6,500 square feet of built space and 26,000 square feet of additional air rights for a total buildable of 32,500 square feet according to a PincusCo analysis of city data. The parcel has frontage of 26 feet and is 125 feet deep with a total lot size of 3,250 square feet. The zoning is C6-4 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 $3.8 million. The most recent loan totaled $13.5 million and was provided by People’s United Bank on February 17, 2022.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property for the past 24 months. In addition, according to city public data, the property has received $350 in OATH penalties in the last year.

Development

For the tax lot building, it received its initial certificate of occupancy on August 1, 2012. There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The neighborhood

In Gramercy, The bulk, or 31 percent of the 11.3 million square feet of commercial built space are elevator buildings, with specialty buildings next occupying 24 percent of the space. In sales, Gramercy has 1.9 times the average sales volume among other neighborhoods with $487.2 million in sales volume in the last two years and is the 20th highest in Manhattan. For development, Gramercy has 1.9 times the average amount of major developments relative to other neighborhoods and is the 18th highest in Manhattan. It had 2.1 million square feet of commercial and multi-family construction under development in the last two years, which represents 19 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of nine of the 20 commercial properties representing 340,624 square feet of the 663,960 square feet. The largest owner is Christy Martin, followed by Samco Properties and then Tishman Realty.
On the tax block, there was one new building construction project filed totaling 110,142 square feet. It is a 150-unit, 110,142 square-foot residential (R-2) building submitted by Tishman Realty and filed by Dan Unger with plans filed February 16, 2023 and it has not been permitted yet.

The majority, or 72 percent of the 663,960 square feet of built space are office buildings, with specialty buildings next occupying 8 percent of the space.

Direct link to Acris document. link