Ingenuity helps transform eyesore to chic storefront.

The ingenuity of the real estate firms of Walter & Samuels is having a profound impact on a strategic Upper East Side corner that was long considered an eyesore of fashionable Madison Avenue.

The southeast corner of 65th Street and Madison - for years a vacant, ugly and undesirable storefront - will soon be the home of famed couturier Valentino, and with the construction of the Armani building diagonally across the street, a once nondescript portion of Madison Avenue is suddenly becoming the hottest new fashion address in New York.

The remarkable transformation is due, in large measure, to the creative vision and perseverance of David Berley, president of Walter & Samuels, and Jud Ebersman, the firm's Director of Retail Leasing, who were given the opportunity and challenge of marketing the 6,000 square feet of retail space within the co-op apartment house at 30 East 65th Street.

To virtually everyone, that space appeared to have limited potential because of several major deficiencies - it was below grade, had low ceilings, and a spectacularly unattractive facade. But Berley and Ebersman saw the potential for an extraordinary store space if they could execute a daring plan that hinged on the ability to purchase the coop apartment directly above.

Once their concept proved feasible and they were assured of getting all necessary approvals, the Walter & Samuels team engineered a remarkable series of transactions. First, they put together an investment group that purchased the shares and proprietary lease of the retail space for $6 million through Michael Dubin of Jean Marc Levet. Then the same group purchased the three-bedroom apartment directly above the store space for the asking price of $475,000.

In order to maintain the same apartment count, which eliminated the costly and time-consuming exercise of changing the building's certificate of occupancy, Berley and Ebersman decided not to demolish the entire apartment. Rather, they created a studio unit and carved out the remaining 1,600 square feet to provide the retail space below, with ten extra feet of ceiling height.

Now, with a space that could be raised to ground level and still offer unusually high ceiling heights, as well as a superb Madison Avenue location, Berley and Ebersman designed an exciting new two-story high facade for the storefront and began marketing to upscale retailers. Within weeks, Rick and Gary Dana of Douglas Elliman brought Valentine to the property and a $30 million retail leasing transaction was soon consummated.

According to Ebersman, plans for the space have been approved by the city's Buildings Department and the New York City Landmarks Preservation Commission, and construction of the store, which will have an address of 747 Madison Avenue, is expected to be completed before the end of the year.

Thus, in a testimony to what real estate ingenuity can accomplish, the co-op at 30 East 65th Street now has an upscale tenant, as well as an improved look and image; Madison Avenue has eliminated an eyesore and in the process has become even more fashionable; and the city has gained new tax revenues.

"We created significant value for everyone," noted Berley, "and isn't that what creative real estate is all about?"