A buyer group is eyeing a residential conversion after buying a Manhattan office space in Penn District for $85 million, according to a report from The Real Deal.
With the equity breakdown unclear, the new owners of the property, called 345 Seventh Avenue, include Kohan Retail Investment Group, Katan Realty Group, and Ilya Mikhailov, who is based in Forest Hills, Queens. To help fund the purchase, Benefit Street has provided a $78 million mortgage.
The new ownership of the site comes after lender Uniform Commercial Code proceeded with a foreclosure on the property in July. But after a deal was nailed out, the action was rescinded and so was a scheduled auction, The Real Deal reported.
Now, it appears there are new plans for the property, and the investment group has its sights set on converting the asset into a residential property. Isaac Katan, president of Katan noted that the area surrounding 345 Seventh was set for "bringing thousands of residential units," according to The Real Deal.
In Manhattan, Katan has invested in a mix of retail, office, and residential assets in its portfolio. Also, its presence expands to other boroughs in New York City including the Bronx, Brooklyn, and Queens. This might be a first for Kohan, whose portfolio only shows the management of exclusively retail properties in the Northeast. It also does not show any assets in New York.
Currently, 345 Seventh features 25 stories and offers 186,000 rentable square feet of space. Also, to add to its appeal, Vornado and Tishman Speyer are leading the efforts on a $45 billion transformation of the Penn District. The move is expected to give the area a total of 7.5 million square feet of office, residential, and retail space.