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BKREA has successfully arranged the $28 million sale of 81 East 3rd Street, a 13-story residential property in Manhattan's East Village. Chairman and CEO Bob Knakal and Managing Director Ana Barrie exclusively represented the seller in the transaction.
The property consists of approximately 36,047 square feet and features a unique combination of 28 student housing units and 13 free-market apartments totaling approximately 187 beds. Its grandfathered density—nearly double what current zoning permits—made the asset one of the most distinctive residential investment opportunities in Manhattan.
Built in 2003, the property has a built Floor Area Ratio (FAR) of approximately 7.5, significantly exceeding today's allowable zoning. Under current R8B zoning, a similar development could not be replicated, making the building an irreplaceable asset.
Situated between First and Second Avenues, the property benefits from immediate access to restaurants, retail, entertainment, public transportation, and major educational institutions, supporting long-term residential demand.
With 28 student housing units alongside market-rate apartments, the building appealed to investors seeking stable occupancy, diversified income streams, and exposure to New York City's growing student housing sector.
The possibility of future vacant possession provides ownership with flexibility to re-lease, reposition, or reprogram portions of the property, creating additional long-term value opportunities.
The transaction demonstrates how zoning limitations and the scarcity of developable residential assets continue to support strong investor demand for well-located Manhattan properties.
BKREA's investment sales team utilized its market knowledge, proprietary research, and targeted marketing strategy to successfully execute the transaction for the seller.
The sale reinforces continued confidence in high-quality Manhattan residential investments that offer both current cash flow and long-term appreciation potential despite evolving market conditions.
As zoning restrictions limit future residential development throughout Manhattan, existing properties with grandfathered density have become increasingly valuable. Investors continue to pursue assets that combine irreplaceable physical characteristics with prime locations and operational flexibility.
The sale of 81 East 3rd Street demonstrates that scarcity, favorable zoning history, and strong neighborhood fundamentals remain powerful drivers of value in New York City's multifamily investment market.
According to Bob Knakal:
"This transaction highlights the continued demand for unique, irreplaceable residential assets in Manhattan's most supply-constrained neighborhoods."
The transaction highlights:
81 East 3rd Street, a 13-story mixed residential building in Manhattan's East Village.
The property sold for $28 million.
Its grandfathered FAR of approximately 7.5 is nearly double what current zoning permits, making it effectively impossible to replicate today.
The building includes 28 student housing units and 13 free-market apartments.
BKREA Chairman and CEO Bob Knakal and Managing Director Ana Barrie exclusively represented the seller.
The sale reflects continued investor demand for supply-constrained residential assets that combine prime locations, unique zoning characteristics, stable income, and long-term appreciation potential.
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