U.S. Dept. of State pays $4M to Carlyle Group for office condo in Turtle Bay

The U.S. Department of State through the entity United States Of America paid $4 million to the Carlyle Group through the entity 866 Plaza Owner, L.L.C. for an office condo at 866 United Nations Plaza in Turtle Bay, Manhattan.
The deal closed on August 11, 2022 and was recorded on September 7, 2022. The unit has 2,731 square feet of built space according to PincusCo analysis of city data. The sale price per built square foot is $1,464 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 March 30, 2017, for $217.5 million. The signatory for Carlyle Group was Jason Hart. The signatory for United States of America was Cliff Seagroves. The buyer is the U.S. State Department. This is unit 587. The Carlyle Group bought the unsold commercial condo units from Meadow Partners in 2017 for $218 million. 

Prior sales and revenue

Prior to this transaction, PincusCo has no record that the buyer United States of America had purchased any other properties and sold two properties in two transactions for a total of $4 million over the past 24 months.
The seller Carlyle Group purchased 43 properties in 27 transactions for a total of $378.2 million and sold two properties in two transactions for a total of $23.9 million over the same time period.

The property

The 866 United Nations Plaza parcel has a total lot size of 2,731 square feet. The city-designated market value for the property in 2022 is $1.1 million.

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 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 $5 million on this tax lot.

The neighborhood

In Turtle Bay, the bulk, or 36 percent of the 8.9 million square feet of commercial built space are specialty buildings, with elevator buildings next occupying 32 percent of the space. In sales, Turtle Bay has had very little sales volume relative to other neighborhoods with $82.9 million in sales volume in the last two years. For development, Turtle Bay has had very little major development activity relative to other neighborhoods.It had 26,950 square feet of commercial and multi-family construction under development in the last two years, which represents 0.30 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of 39 of the 94 commercial properties representing 169,562 square feet of the 270,198 square feet. The largest owner is Carlyle Group, followed by Kingdom Of Saudi Arabia and then Slovak Republic.
There are no active new building construction projects on this tax block.

The seller

The PincusCo database currently indicates that Carlyle Group owned at least 128 commercial properties in New York City with 1,998,319 square feet and a city-determined market value of $482.1 million. (Market value is typically about 50% of actual value.) The portfolio has $905.7 million in debt, with top three lenders as Invesco Real Estate, Invesco, and Santander Bank respectively. Within the portfolio, the bulk, or 63 percent of the 1,998,319 square feet of built space are elevator properties, with rental condo properties next occupying 8 percent of the space. The bulk, or 38 percent of the built space, is in Manhattan, with Queens next at 33 percent of the space.

The buyer

The PincusCo database currently indicates that United States Of America owned at least five commercial properties in New York City with 17,915,511 square feet and a city-determined market value of $1.4 billion. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 68 percent of the 17,915,511 square feet of built space are Q9 properties, with specialty properties next occupying 15 percent of the space. The bulk, or 68 percent of the built space, is in Queens, with Manhattan next at 17 percent of the space.

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