Sage Hall Partners acquires hotel in Grand Central with $99M in debts, foreclosed on Shorewood, Prodigy Network

Sage Hall Partners through the entity 46 Turtle Bay LLC acquired the former AKA United Nations hotel with $99 million in debts, through a foreclosure auction this month. The prior owners were Shorewood Real Estate Group and Prodigy Network who lost the 95-unit hotel building (HS) at 234 East 46th Street in Grand Central, Manhattan following a foreclosure, 850006/2021.
The deal closed on April 25, 2023 and was recorded on April 26, 2023. The property has 82,829 square feet of built space according to a PincusCo analysis of city data. The sale price per built square foot is $158 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 seller bought the property on September 17, 2014, for $68.5 million. The signatory for the court representing Shorewood Real Estate Group and Prodigy Network was Thomas R. Kleinberger. The signatory for Sage Hall Partners was Jeffrey Fields.
The approximate value of the lien was $99,985,855 as of auction set for April 19. The judgment of foreclosure was ordered in a decision from September 2022. The winning bid was $10 million according to the deed, while the transfer amount in city records was $13.2 million. The former owners through the entity 234 East 46th Street Property Owner LLC were foreclosed on. Sage Hall Partners has an address at 330 Madison Avenue, second floor.

Sage Hall bought the debt in February 2023 from Canadian Imperial Bank of Commerce and stepped into the foreclosure, as PincusCo reported at the time. According to Sage Hall’s website, it was, “Established in 2020 by industry veterans Lanhee Yung and Sush Torgalkar, Sagehall is a diverse private investment firm focused on strategic real estate opportunities”

Prior sales and revenue

Prior to this transaction, PincusCo has no record that the buyer Sage Hall Partners had purchased any other properties and has no record it sold any properties over the past 24 months.
The seller Shorewood Real Estate Group had not purchased any other properties and had not sold any properties over the same time period. The former owners according to the Department of Housing Preservation and Development includes Roberta Ashkin, head officer and Noel Pearson, site manager. The business entities are Eric Goodman Realty and 234 East 46th Street Property Owner Llc.

The property

The hotel building with 95 residential units in Grand Central has 82,829 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 75 feet and is 100 feet deep with a total lot size of 7,537 square feet. The zoning is R10 which allows for up to 10 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $13.2 million. The most recent loan totaled 0.0 and was provided by Sage Hall Partners on February 14, 2023.

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 three DOB violations, $6,250 in ECB penalties, and $10,650 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 $1 million on this tax lot. On the tax lot, the most recent condominium plan was filed by 234 EAST 46TH STREET PROPERTY OWNER LLC to create 95 residential units in a building at 234 East 46th Street in Midtown East, Manhattan, called Aka United Nations Condominium Residences that has a $137.6 million sellout, according to an February 19, 2015 submission to the New York State Attorney General. The principals of the sponsor, 234 EAST 46TH STREET PROPERTY OWNER LLC, were S. Lawrence Davis, Bradley Korman, Lawrence Korman, and Rodrigo Nino.

The neighborhood

In Grand Central, The majority, or 83 percent of the 43.5 million square feet of commercial built space are office buildings, with hotel buildings next occupying 8 percent of the space. In sales, Grand Central has 3 times the average sales volume among other neighborhoods with $1 billion in sales volume in the last two years and is the 14th highest in Manhattan. For development, Grand Central has 2.5 times the average amount of major developments relative to other neighborhoods and is the 14th highest in Manhattan. It had 2.5 million square feet of commercial and multi-family construction under development in the last two years, which represents 6 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of six of the 16 commercial properties representing 575,093 square feet of the 986,973 square feet. The largest owner is Slate Property Group, followed by Prodigy Network and then Oak B Management.
On the tax block, there were two new building construction projects totaling 134,119 square feet. The largest is a 106-unit, 113,707 square-foot residential (R-2) building submitted by New Providence Supporting Housing and filed by Paul Woody with plans filed March 20, 2023 and it has not been permitted yet. The second largest is a 15-unit, 20,412 square-foot residential (R-2) building submitted by Eduard Slinin with plans filed October 7, 2015 and it has not been permitted yet.

The majority, or 79 percent of the 986,973 square feet of built space are office buildings, with elevator buildings next occupying 9 percent of the space.

The seller

The PincusCo database currently indicates that Shorewood Real Estate Group owned at least three commercial properties with 418 residential units in New York City with 418,308 square feet. The portfolio has $110.1 million in debt, borrowed from East West Bank and Bayview Commercial Mortgage Finance, LLC. Within the portfolio, the bulk, or 78 percent of the 418,308 square feet of built space are elevator properties, with hotel properties next occupying 20 percent of the space. The bulk, or 78 percent of the built space, is in Queens, with Manhattan next at 20 percent of the space.
The PincusCo database currently indicates that Prodigy Network owned at least one commercial property with 95 residential units in New York City with 82,829 square feet. The portfolio consists of at least a single hotel property. It is located in Manhattan.

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