Swig buys Sheffield building for $418m.
Such was the case for Rose Associates--a powerhouse real estate family well known for its hesitancy to cash-out of properties--in its $418 million sale last Thursday of The Sheffield, a 50-story, 845-unit residential rental building located at 322 West 57th Street.
The lofty sales price, which was reached in the second round of bidding by a partnership between Kent Swig, Yair Levy and Serge Shoyda, came as no surprise to Rose Associates' president Adam R. Rose. According to Rose, he had already had ample time to get over the astonishment inspired in him by CBRE's Darcy Stacom, the broker for the transaction, when she indicated prior to the bidding that the building would fetch nothing south of $400 million.
"We just kept hearing about the numbers that were being achieved for properties these days and when we learned what The Sheffield was worth, we decided to take advantage of this unique market," Rose said.
When asked why Rose Associates, which owns a number of prominent properties, including One Battery Park Plaza, selected to sell The Sheffield rather than another asset, Rose called it their "biggest and juiciest" property, rife with redevelopment possibilities, and would consequently garner the highest sales price. The influx of cash will fuel up to five different development projects the firm is currently planning in both Boston and Manhattan.
The Sheffield's new owners have development ideas of their own. According to Rose, the partnership between Swig, Levy and Shoyda, will almost certainly convert the building into luxury condos, a move that would require extensive construction, and one that could be realized in any of several potential incarnations. Rose indicated that his firm briefly considered converting the property into condominiums over a decade ago when it was similarly converting nine other residential properties it owns in Manhattan.
"This building offers so many choices as to what you can do with it," Rose said. "They could make minor alterations to the current structure, such as update the kitchens, or they could vacate the whole property and combine apartments to make for larger luxury dwellings that would fetch $1200-$1500 per s/f. Maybe they'll do something in between and put a hotel or seasonal apartments on the lower floors. There's so much you can do."
If Swig is in fact thinking residential conversion, he teamed with the right duo. Back in November of 2004, Levy converted 29 John Street, an 80K s/f office building into 50 luxury condos. It wasn't only conversion skills that made for the partnership however. The bidding for The Sheffield was so competitive that many of the first round's 15 competitors aligned or found new partners by the second round, which only had five bidders. Swig, who had different partners in the first round, partnered with Levy and Shoyda in the second to break the $400 million mark and put in the winning bid.
"This was a really great price for us," Rose said. "But I don't feel guilty about it, the buyers got a great piece of property and when they're done doing what they're going to do with it, I know they will reap impressive returns."
REW was unable to contact Swig, Levy or Shoyda by press time.
|Printer friendly Cite/link Email Feedback|
|Title Annotation:||Kent Swig|
|Publication:||Real Estate Weekly|
|Date:||Jan 19, 2005|
|Previous Article:||Park Central Hotel fetches $200m; Stanhope facing co-op conversion.|
|Next Article:||Housing boom here to stay, Teplitzky tells conference.|