Rockrose Development Corp. has acquired the commercial portion of the Madison Square Bldg. at 15 E. 26th St. in New York City from Savanna Real Estate Fund for $105 million, or about $700 per square foot.
The 150,000-square-foot boutique commercial office space is part of the larger 20-story, 330,000-square-foot, 4-Star, mixed-use property with ground-floor retail and residential above. Developed in 1920 by Henry Corn with Maynicke & Franke architects, the building sits on 0.4 acres in Manhattan's Gramercy Park submarket, between Madison and Fifth Avenues.
The commercial asset is currently 95% leased to tenants on floors one through eight, including Vera Wang's executive offices and showroom.
The seller acquired the property in February 2012 for $57.8 million, according to CoStar data. They undertook a $9 million capital improvement plan that included a redesign of the entrance and lobby, upgraded elevators, sidewalk replacement and boiler upgrade. In addition, the owners worked with the Jones Lang LaSalle team of Mitchell Konsker, Matthew Astrachan, Matthew Polhemus and Brittany Wunsch in leasing up the property at market rents.
"We are pleased that upon completion of our business plan and leasing efforts at 15 East 26th Street, we will be able to deliver exceptional returns to our investors," said Nicholas Bienstock, managing partner at Savanna.
The new owners plan to continue upgrading and modernizing the asset, continuing a strategic plan for Rockrose to grow its office portfolio in both New York City and Washington, DC.
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"We are very strong believers in the strength of the Midtown South office market. We completed our renovation and rebranding of the nearby Creative Arts Building at 300 Park Avenue South in 2012, bringing it to full occupancy with stellar tenants in less than a year," said Justin Elghanayan, president at Rockrose. "15 East 26th Street is a similar, very handsome building located on one of the most pristine parks in Manhattan, and it fits with our plans to purchase well located office buildings, upgrade them to be best-in-class, and hold the assets for the long-term."
Craig Deitelzweig, head of Rockrose's office division, represented the buyer in-house. Adam Spies, Doug Harmon, Adam Doneger and Joshua King with Eastdil Secured represented Savanna in the sale.
Please see CoStar COMPS #2911591 for additional information on this transaction.