Sovereign Partners pays $126.5M to Clarion for office in Flatiron District, financed by $81.5M non-bank loan

Sovereign Partners through the entity 100 Fifth Owners, LLC paid $126.5 million to Clarion Partners through the entity Clpf – 100 Fifth Avenue, LLC for the office condominium unit at 100 Fifth Avenue in the Flatiron District, Manhattan. Sovereign Partners financed the purchase with an $81.5 million loan from a non-bank lender.

The deal closed on October 23, 2023 and was recorded on November 2, 2023. The property has 224,260 square feet of built space according to a PincusCo analysis of city data. The sale price per built square foot is $564 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 June 4, 2013, for $230 million. The signatory for Clarion Partners was Jonathan Gelb. The signatory for Sovereign Partners was Cyrus Sakhai. The contract date was September 18, 2023.
The entity SK Lender Two LLC provided the $81.5 million loan. That entity shares an address in Englewood Cliffs, New Jersey, with a company called Jasper Lake LLC, headed by Joseph Kolatch and Noah Kolatch. They are sons of Jonathan Kolatch, founder of the hedge fund Redwood Capital Management. A call to representatives of Jasper Lake was not immediately returned.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Sovereign Partners purchased one property in one transaction for a total of $113 million and has no record it sold any properties over the past 24 months.
The seller Clarion Partners had not purchased any other properties and sold 17 properties in nine transactions for a total of $128.1 million over the same time period.

The property

The office condo in Flatiron District has 224,260 square feet of built space according to a PincusCo analysis of city data. The parcel has a total lot size of 224,260 square feet. The city-designated market value for the property in 2022 is $90.5 million.

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 not received any significant violations 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.

The neighborhood

In Flatiron District, The majority, or 71 percent of the 23.2 million square feet of commercial built space are office buildings, with elevator buildings next occupying 15 percent of the space. In sales, Flatiron District has the 10th highest sale turnover among other neighborhoods in the city with $1.5 billion in sales volume in the last two years. For development, Flatiron District has 2.5 times the average amount of major developments relative to other neighborhoods and is the 10th 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 11 percent of the neighborhood’s built space. There was one pre-foreclosure suit filed among other office buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of two of the five commercial properties representing 109,149 square feet of the 187,168 square feet. The two identified owners are Zucker Organization and Jack Di Mauro.
There are no active new building construction projects on this tax block.

The majority, or 54 percent of the 187,168 square feet of built space are elevator buildings, with specialty buildings next occupying 32 percent of the space.

The seller

The PincusCo database currently indicates that Clarion Partners owned at least two commercial properties in New York City with 1,900,526 square feet and a city-determined market value of $631.4 million. (Market value is typically about 50% of actual value.) The portfolio has $30 million in debt, borrowed from Allianz Life Insurance Company Of North America. Within the portfolio, all identified are office properties. They are all located in Manhattan.

The buyer

The PincusCo database currently indicates that Sovereign Partners owned at least one commercial property in New York City with 171,591 square feet and a city-determined market value of $76.1 million. (Market value is typically about 50% of actual value.) The portfolio has $71.2 million in debt, borrowed from Deutsche Pfandbriefbank. The portfolio consists of at least a single office property. It is located in Manhattan.

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