Zar Property NY pays $27M for office in Flatiron District

Zar Property NY through the entity East 18th Street LLC paid $27 million to long-time owners through the entity 37-41 East 18th Street Realty Co., LLC for the office building (O6) at 37 East 18th Street in Flatiron District, Manhattan.
The deal closed on August 29, 2024 and was recorded on September 6, 2024. The property has 67,051 square feet of built space according to a PincusCo analysis of city data. The sale price per built square foot is $403 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 sale went into contract on July 31, 2024.
The signatory for the buyer was Dario Zar, and for the sellers were Norman Sheer, Sari Greenbaum and Steve Kerler.
Zar Property NY is a family-owned firm that owns office, retail and multifamily properties, led by principals Dario Zar, David Zar, Simon Zar, Jonathan Zar and Julian Zar. In 2022, it signed a $100 million refinance in SoHo.

Bob Knakal, formerly of JLL and now with his own firm BK Real Estate Advisors, brokered the deal. This was the first recorded deal Knakal brokered since leaving JLL in February this year, insiders said.

The property

The parcel has frontage of 75 feet and is 92 feet deep with a total lot size of 6,899 square feet. The zoning is M1-5M which allows for up to 5 times floor area ratio (FAR) for manufacturing The property is in the Ladies’ Mile Historic District. The city-designated market value for the property in 2022 is $21.3 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 received $600 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.

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 1.2 times the average sales volume among other neighborhoods with $327.7 million in sales volume in the last two years and is the 24th highest in Manhattan. For development, Flatiron District has 2.7 times the average amount of major developments relative to other neighborhoods and is the 11th highest in Manhattan. It had 2.9 million square feet of commercial and multi-family construction under development in the last two years, which represents 12 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 four of the eight commercial properties representing 942,905 square feet of the 1,106,174 square feet. The largest owner is Winter Management, followed by TF Cornerstone and then Normandy Real Estate Partners.
There are no active new building construction projects on this tax block.

The majority, or 90 percent of the 1.1 million square feet of built space are office buildings, with retail buildings next occupying 9 percent of the space.

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