Massey Knakal Arranges Sale Of Fee Interest In Hotel Le Bleu
Massey Knakal has arranged the sale of the fee interest in a building occupied by Hotel Le Bleu. The building is located at 370 4th Avenue in Brooklyn’s Park Slope neighborhood and was sold in an all-cash transaction valued at $10,250,000.
The nine-story, 48 key, boutique-hotel building contains approximately 25,537 square feet and sits on a 55.5’ x 200’ lot. Globiwest has a 99-year master lease for the property, which began in 2005, to operate a hotel in the entire building. The sale price equates to approximately $401 per square foot and a cap rate of 6.01%.
Although the original lease agreement was not a true NNN lease, Massey Knakal assisted the seller in renegotiating the master lease to include the entirety of the property and enhance the annual rent.
“This cash-flowing property was perfectly situated between two of Brooklyn’s most vibrant neighborhoods: Park Slope and Gowanus. This resulted in high demand from both national buyers and local investors,” said Massey Knakal’s Guthrie Garvin, who exclusively handled this transaction with Winfield Clifford and Andrew Posil. “The key to unlocking value for our client was Massey Knakal’s ability to work with the existing tenant to modify the lease agreement. After negotiating away certain landlord obligations, the market responded quickly to a true net lease opportunity,” said Clifford.
“There is great interest in Brooklyn’s long underserved hotel market for existing product and development opportunities. The $213,000 per key price for the underlying asset, exclusive of operating income, attests to the growing strength of the Brooklyn hotel market,” added Posil.
Massey Knakal specializes in the sale of investment and user properties in the New York Metropolitan area. Since 1988, our agents have closed over 4,700 transactions having a market value in excess of $19 billion.