Sky Management pays Madison Realty $18.5M for Chelsea rental, was $21.75M in 2014

Jonathan Ohebshalom’s Sky Management paid Madison Realty Capital $18.5 million for the 36-unit Chelsea rental at 421 West 21st Street. Madison Realty Capital bought the property for $21.75 million in 2014, with plans to reposition and modernize the building.

Madison Realty Capital is one of the city’s most active private equity investment firms, deeply involved in lending, development and ownership.

The elevator building with 36 residential units in Chelsea has 26,800 square feet of built space according to a PincusCo analysis of city data. The building is on a 6,750-square-foot. The city-designated market value for the property in 2022 is $6.9 million.

The sale closed on August 28, 2024, and was recorded on September 19, 2024. The contract date was August 28, 2024. Jonathan Ohebshalom signed for the buyer, while Urian Yap signed for Joshua Zegen’s Madison Realty Capital.

Madison Realty Capital bought the building in 2014 with a plan, according to a press release, “to pursue a comprehensive value oriented capital expenditure program in order to reposition and modernize the property, which includes renovating vacant units into high-end luxury units, enhancing the lobby, hallways and elevator, and improving the overall operating efficiency of the property.”
The multifamily market was hit by several shocks over the past 10 years including the 2019 rent law changes, Covid and a steep rise in interest rates.

Lev Mavashev of Alpha Realty brokered the sale, as well as the 2014 transaction.

Prior sales and revenue

This property was sold for $21.75 million on October 9, 2014.

The 26,800-square-foot property generated revenue of $1.3 million or $47 per square foot, according to the most recent income and expense figures.

Violations and lawsuits

According to city public data, the property has received four housing violations and $100 in OATH penalties in the last year.

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

The neighborhood

In Chelsea, The bulk, or 35 percent of the 52.5 million square feet of commercial built space are office buildings, with elevator buildings next occupying 28 percent of the space. In sales, Chelsea has the 9th highest sale turnover among other neighborhoods in the city with $1 billion in sales volume in the last two years. For development, Chelsea has near average amount of major developments among other neighborhoods and is the 20th highest in Manhattan. It had 1.6 million square feet of commercial and multi-family construction under development in the last two years, which represents 3 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of 12 of the 26 commercial properties representing 151,369 square feet of the 235,669 square feet. The largest owner is Adam Daniels, followed by Black Spruce Management and then Brodsky Organization. There are no active new building construction projects on this tax block.

The owner

The PincusCo database currently indicates that Madison Realty Capital owned at least 64 commercial properties with 2,619 residential units in New York City with 2,787,930 square feet and a city-determined market value of $392.4 million. (Market value is typically about 50% of actual value.) The portfolio has $1.5 billion in debt, with top three lenders as Signature Bank, MF1 Capital, and Elliott Investment Management respectively. Within the portfolio, the bulk, or 71 percent of the 2,787,930 square feet of built space are elevator properties, with walkup properties next occupying 13 percent of the space. The bulk, or 42 percent of the built space, is in Queens, with Manhattan next at 34 percent of the space.

The owners according to the Department of Housing Preservation and Development includes Julia Rodriguez, head officer and Vesa Naka, agent. The business entities are Silverstone Property Group, Llc and 421 West 21st Street Llc.

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