INVESTMENT OPPORTUNITY 15-17 EAST 16TH STREET RETAIL CO-OP
FLATIRON DISTRICT/UNION SQUARE | NEW YORK
RKF INVESTMENT SALES & ADVISORY SERVICES 15-17 EAST 16TH STREET | INVESTMENT OPPORTUNITY 2
RKF INVESTMENT SALES & ADVISORY SERVICE HAS BEEN EXCLUSIVELY RETAINED FOR THE SALE OF THE RETAIL SPACE AT 15-17 EAST 16TH STREET. INVESTMENT HIGHLIGHTS
5,679-SF commercial unit with Ground Floor, Mezzanine and Lower Level Prime street connecting Flatiron District and Union Square One of Manhattan’s most dynamic retail markets Short-term Sale-Leaseback will be considered Favorable Tax Class 2
FOR MORE INFORMATION PLEASE CONTACT GEORGE MARTINECZ Associate 212.916.3381 [email protected] BRIAN SEGALL Senior Managing Director 212.351.9346 [email protected]
RKF INVESTMENT SALES & ADVISORY SERVICES 521 Fifth Avenue, Floor 7, New York, NY 10175 | T 212.599.3700 | F 212.599.3744 | [email protected] | www.rkf.com © 2017 ROBERT K. FUTTERMAN & ASSOCIATES, LLC All information is from sources believed reliable, not independently verified, and thus subject to errors, omissions, and modifications such as price, listing, square footage, rates and commissions. All information, estimates and projections subject to change, market assumptions, unknown facts and conditions, and future potentialities. RKF makes no express or implied representations or warranties, as facts and results may vary materially from all information, estimates and projections. All renderings presented are conceptual. 15-17 EAST 16TH STREET | INVESTMENT OPPORTUNITY 3
PROPERTY OVERVIEW
15-17 East 16th Street is a retail cooperative conveniently PROPERTY DETAILS located between Fifth Avenue and Union Square West. The elegant pre-war loft building features 30-FT of glass ADDRESS 15 East 16th Street frontage beneath a striking limestone arch flanked by ornate BLOCK/LOT 844-11 and detailed carvings. The storefront is built out for a luxury TENANT Country Floors home furnishings showroom for which side streets in the Flatiron District have become known. Dramatic ceiling RETAIL AREA 5,679 SF heights on the Ground Floor eclipse 20-FT and complement GROUND FLOOR 3,417 SF the easily accessible Mezzanine and Lower Level, which LOWER LEVEL 1,943 SF can be utilized as additional merchandising floors. The open layout lends itself to a variety of uses and can be easily MEZZANINE 319 SF modified to suit a gallery, design showroom or Ground Floor MAINTENANCE (PROJ. 2019) $122,299 office space. TAX CLASS 2 A prospective purchaser of the co-op will assume ownership ZONING C6-2A of six shares in the corporation. The retail unit is currently CO-OP SHARES 6 owner-occupied and a sale-leaseback of the property will be CEILING HEIGHT (GROUND FLOOR) 20 FT considered. FRONTAGE 30 FT
USE GROUP 6
Food/Restaurant, Fitness, PROHIBITED USES Clinic, Spa, Pets 15-17 EAST 16TH STREET | INVESTMENT OPPORTUNITY 4
FLOOR PLANS
GROUND FLOOR MEZZANINE LOWER LEVEL
30 FT
3,417 SF 319 SF 1,943 SF 15-17 EAST 16TH STREET | INVESTMENT OPPORTUNITY 5
MARKET OVERVIEW
The concept of “live-work-play” is rooted in Flatiron District/Union Square. Value in this centrally-located area is driven by high-end residential development, technology and media company headquarters and contemporary retailers alongside national brands.
The 14th Street/Union Square subway station is the fourth busiest in the city, serving approximately 35 million riders annually on seven different train lines. New York University students and staff flock to the park and surrounding side streets as an extension of the campus. Students living in Carlyle Court, the school’s dormitory on East 16th Street, frequent the surrounding storefronts and experiential retail concepts. Tenants like Whole Foods Market, Paragon Sports, and Barnes & Noble are complemented by New York City’s world-famous Union Square Greenmarket, where vendors sell produce, meats, baked goods and other artisanal foods in an electric outdoor market. Weekend foot traffic is buoyed by a national retail corridor on Fifth Avenue in the Flatiron District. East 16th Street is the most active thoroughfare connecting these two vibrant and interconnected submarkets. A limited supply of quality retail space on Flatiron District side streets has kept vacancy low and rents high. 15-17 EAST 16TH STREET | INVESTMENT OPPORTUNITY 6
AREA MAP
EAST 19TH STREET
Boucherie
Rothmans EAST 18TH STREET CVS Scampi Fraiche Maxx Venchi PARK AVENUE SOUTH
Irvington EAST 17TH STREET
EAST 16TH STREET 15-17 EAST 16TH STREET
Kindbody UNION
SQUARE Daryl Roth Theater IRVING PLACE IRVING EAST 15TH STREET PARK
Fit Hub N R W EAST 1 TH STREET
NOTABLE LEASE TRANSACTIONS
ADDRESS TENANT APPROXIMATE SIZE DEAL RENT DATE
108 FIFTH AVENUE Bandier Ground Floor 2,300 SF $787,500 per annum NNN 2018 Southwest corner of East Lower Level 3,000 SF $250,000 Tenant Allowance 16th Street Total 5,300 SF 8.5 Year Sublease 4 Months Free
136 FIFTH AVENUE Sleep Number Ground Floor 3,650 SF $1,150,000 per annum NNN 2018 West block between West Lower Level 3,650 SF $370,000 Taxes 18th and West 19th Streets Mezzanine 350 SF Total 7,650 SF
861 BROADWAY Bulletin Ground Floor 1,440 SF $400 PSF 2018 West block between East Basement 1,200 SF $576,000 per annum 17th and 18th Streets Total 2,640 SF 15-17 EAST 16TH STREET | INVESTMENT OPPORTUNITY 7
FINANCIAL OVERVIEW
ASSUMPTIONS PROJECTED STABILIZATION COSTS
GROUND FLOOR RENT $150 LEASING COMMISSIONS $202,005
LOWER LEVEL RENT $25 DOWNTIME $280,563
RENT INCREASE/PER YEAR 3% FREE RENT $140,281
DOWNTIME 6 Months TOTAL LEASING COSTS $622,849
FREE RENT 3 Months
LEASING COMMISSION 36%
PROJECTED CASH FLOW
RENTAL REVENUE (PROJ.) 2019 2020 2021 2022 2023
GROUND FLOOR $512,550 $527,927 $543,764 $560,077 $576,880
LOWER LEVEL $48,575 $50,032 $51,533 $53,079 $54,672
EFFECTIVE GROSS REVENUE $561,125 $577,959 $595,298 $613,156 $631,551
OPERATING EXPENSES
CO-OP MAINTENANCE (PROJ.) $122,299 $125,968 $129,637 $133,306 $136,975
MANAGEMENT FEE (PROJ.) $10,251 $10,559 $10,886 $11,174 $11,481
TOTAL EXPENSES $132,550 $136,527 $140,503 $144,480 $148,456
NET OPERATING INCOME $428,575 $441,432 $454,794 $468,677 $483,095