February 26, 2018
A local investor paid $5.425 million for 70-74 E. 116th St., a five-story affordable housing property in the East Harlem section of Manhattan. The building includes 23 apartments currently reserved for low-income residents, and three retail stores. That works out to a price of roughly $200,000 per unit.
The buyer saw significant upside potential in this acquisition because of the building’s two regulatory agreements due to expire in six years. It had received funding through affordable housing programs, including federal low-income housing tax credits, but the restrictions on how high the rents can go at the property are now close to their expiration.
Also the three commercial units are currently signed to below-market leases, with near-term expiration dates.
“The buyer recognized the long-term potential of this asset, particularly as it pertains to the expiring regulatory agreements and the upside to be gained in the residential and commercial rents. Additionally, the property was completed gutted a number of years ago, and is in excellent condition,” said Kobi Zamir of GFI Realty, representing the buyer and seller in the transaction, both of whom are local investors.