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Discover the sale of a prime retail investment co-op at 85 Fifth Avenue in Union Square. Ideal for investors, this property offers high visibility, a coveted location, and excellent growth potential in one of Manhattan's busiest commercial hubs.
Property Highlights: Retail Co-Op Investment Property Sale for 85 Fifth Avenue
RFR Holding LLC's corner retail co-op at 85 Fifth Avenue, located near Union Square, attracted significant interest due to a booming retail market, with prices increasing 109% from 2014 to 2015. Our strategic marketing campaign resulted in eight qualified offers and a successful sale for $86 million, with high praise from RFR for our ability to generate competitive bids and maximize the asset's value.
- Union Square Retail Co-Op: RFR Holding LLC owned a prestigious corner retail co-op at 85 Fifth Avenue, located near Union Square.
- Size: 6400 SF Ground level, 12,946 including lower level space
- Retail Co-Op Sale Price: The asset sold for $86 million, translating to $13,425 per square foot above grade and a 3.95% cap rate, well above market averages.
- Retail Store Price Increase: The retail market saw a 109% price increase per square foot from 2014 to 2015, boosting the co-op's investment appeal.
- Strategic Engagement: RFR chose our team for our valuation expertise and extensive marketing process to maximize exposure and attract buyers.
- Effective Marketing: Our campaign reached over 20,000 investors in a week, leading to eight qualified offers within four weeks.
85 Fifth Avenue is a prominent retail co-op located in a prime area near Union Square. It is within walking distance of landmarks such as the Union Square Greenmarket, the historic Flatiron Building, and many shops and restaurants along Broadway.
Cornering the Retail Market
RFR Holding LLC is recognized as one of the top private real estate investment firms in NYC, owning some of Manhattan’s most prestigious trophy assets. Included in their world-class portfolio was a corner retail co-op at 85 Fifth Avenue.
The co-op is situated in a highly desirable retail location, one block from Union Square. In a growing retail market, the average price per square foot paid for retail-driven assets increased 109% in 2014 to approximately $3,870 per square foot in 2015.
As a result, the 6,406 square foot retail co-op (12,946 combined above and below grade) became a very attractive investment opportunity for many NYC investors.
RFR understood the need for maximum exposure in order to receive a desirable result during their exit strategy, so they engaged me and our sales team. RFR elected to involve us not only for our valuation expertise but more importantly, for our proven, extensive marketing process. Having a longstanding relationship with, RFR was relying on my team’s expansive market outreach and interaction with the brokerage community.
Within the first week of launching 85 Fifth Avenue, the Informational Setup indicating the opportunity was available for purchase was received by over 20,000 local and foreign investors.
Due to the above-market lease, we knew the likelihood of procuring a qualified purchaser at an acceptable level would only be possible by receiving interest from several parties. Only this would result in the desired goal of a competitive bidding process involving those bullish on the location.
We implemented a rigorous marketing campaign that resulted in a flawless contract execution well above expectations. Here are our results:
- Offers: Eight qualified offers were acquired within just four weeks of marketing.
- Bidding: After several rounds of competitive bidding, a hard contract was signed at $86 million with a 10% deposit and no longer than 90-day close.
- Price: The purchase price translates to $13,425 per square foot above grade and $6,642 per square foot blended, both equating to significantly above the Manhattan-wide average.
- Cap Rate: A cap rate of 3.95% for a retail asset with minimal upside in the near term was achieved.
- Success: Although the successful purchaser was an obvious prospect, the final purchase price was substantially higher than the initial offer due to the increased competition for the asset created by our sales team.
Testimonial - Aby Rosen of RFR Holding on the Successful Marketing of Retail C0-Op at 85 Fifth Avenue
Here's what Aby Rosen of RFR Holding had to say:
"We have enjoyed a long-term relationship with Bob Knakal and his team. When we were considering the sale of our retail condo at 85 Fifth Avenue, we felt Bob would be able to expose the asset to a large and diversified field of potential buyers from across the globe. We were very impressed with the wide array of interested prospects that the team developed. All of that competition led to a very favorable result for us. We are happy to recommend Bob and his team to other potential sellers."
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