Classic building at the heart of Manhattan, including 26 units for rent, with high occupancy. The units include 3 studios (2 units will be converted to 1 bedroom), 21 one-bedroom apartments (for renovation) and 2 commercial units.
The project’s condition is required different levels of renovation.
The average rent price in this project is: $1830, comparing to the average rent price in the buildings in the neighbourhood: $2590 (for 1 bedroom flat).
Upon upgrading completion and letting the units at up-to-date price - the property value is expected to increase accordingly.
The property is registered under the name of the investors and the sponsors group: a US Property Investment Specialist who is running over $350M worth of properties in the US and is specialized in multifamily properties - residential properties for rent, a commercial mortgage banking firm specialized in financing multifamily properties and a firm specialized in development and management of Manhattan multifamily properties, managing today over 1000 flats which it has previously upgraded.
This powerful cooperation between 3 firms has gathered to create revenue making Manhattan portfolio of residential buildings. The group’s main focus is on affordable rent to middle-class tenants. This cooperation has yielded two properties which are already going through an upgrade process via flats renovation and rent increase.
The location - neighborhood data:
The Upper East Side is located between the 59th St. and 96th St. and is east to Central Park.
Well established classic neighborhood with a wealthy population (including families such as: Kennedy, Roosevelt, Rockefeller and others).
Culture and Leisure: The 5th Avenue, Central Park, The Museums area: Metropolitan, Guggenheim and many more.
Education and Health: The famous University and Hospital: Mount Sinai.
The classic buildings, the wide pavements and the relative quite area attract high quality tenants.
The average household annual income is: $147,000 - among the highest in the city.
The project’s strategic plan
Step 1. Vacated upon contract termination
Each apartment will become vacant once contract is terminated.
Step 2. Renovation
Cosmetic and Gut renovation of all units, bringing them to high end market standards.
Step 3. Renting out
Letting the apartments at current price levels
Step 4. Refinancing
The goal: Returning most of the capital invested
Step 5. Realization
Realization of the property at updated value, and creating substantial capital gain
This is the exact location of the property development.
Check the images of the property. If you would like to view them in higher resolution, please click on any image.
An example of a property that was acquired by the sponsors group at the end of 2015:
Stone exterior building, comprised of 20 units for rent in 27th street at: Kips Bay neighbourhood in the heart of Manhattan.
The upgrading process and tenants replacement is now working in progress, each flat once contract is terminated.
A flat that was previously rented for: $1600, has finished the upgrading process and was rented out in 24 hours from it first publish for: $3,095.
Min investment amount: $100,000 + 5% raising fee (In the Manhattan projects the deposit fee is on top of the investment amount and not included as the model is slightly different due to the investment group).
The expected IRR in this project per year for 5 years’ time: 18.85%.
Manhattan rental market
The Manhattan property market is composed of rental (multifamily buildings) and for sale (condominium’s and cooperative’s) properties.
Prices for both rental and sale properties have increased significantly due to lack of sufficient supply.
Increased rental prices and the shortage of affordable apartments are driving middle class renters out of Manhattan.
The strategy of the project is to re-establish affordable apartments across Manhattan
The Manhattan opportunity
A leading world financial & cultural center.
Over 27,000 people per square kilometer.
Growing demand for rentals units.
Over $100,000 average annual household income.
Average rents are around $4,000, the highest in the US.
The richest & most populated quarter in the United States.
The majority of the new built units are targeted for the high-end tenants.
A growing demand for affordable rentals at around $3,000
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