Israeli Company Sells Upper East Side Retail Property for $153 Million

Israeli Company Sells Upper East Side Retail Property for $153 Million

 

 By:  Benyamin Davidsons

Israel-based real estate investment firm, G City, has entered a contract to sell its retail property on the Upper East Side for $153million, as per a recent filing with the Tel Aviv Stock Exchange.   The identity of the new buyer of the property has not been disclosed.

As reported by Crain’s, the 120,000-square-foot property located at 410 E. 61st St. was formerly occupied by Bed Bath and Beyond.  In October 2020, Home Depot signed a 20-year lease for the spot, making headlines as the largest retail lease that year.  Home Depot, which is expected to move in next year, agreed to pay a record $659 per square foot, also making it one of the costliest deals for a Manhattan retail space within the last few years.   “The reports of retail’s death in New York City have been greatly exaggerated,” Jeff Mooallem, president and CEO of the real estate company Gazit Horizons, the U.S. subsidiary of G City, told CNBC when the lease deal was inked.

G city, formerly known as Gazit Globe, had purchased the retail property not too long ago, in 2017 and 2018, in two deals for a total of roughly $80 million.  The company recently announced that it would spend $20 million to build out the Home Depot space.  The sale price of $153 million still allows the company a pretty penny in profits.  As per Crain’s, once finalized the sale of the retail property will bring the Israeli real estate investment firm net proceeds of $30 million.

In August 2021, G City had announced that it obtained a $134 million refinancing for the property, which translates into an extra $30 million in profit for the firm.   The global firm, which is listed on the Tel Aviv stock exchange, specializes in income-producing properties for mixed use including retail, office and residential located in densely populated urban cities around the world.  Currently, Gazit Horizons owns four properties in New York City.  This includes: the retail space below The Edge in Williamsburg, Caesar’s Bay Bazaar in Brooklyn’s Sheepshead Bay, a retail building at 555 Fifth Ave. in Brooklyn’s Park Slope, and a retail strip mall in Maspeth of Queens.

A representative for Gazit Horizons did not respond to Crain’s request for comment on the sale.

Known as the biggest home improvement retailer in the country, Home Depot will close its current 80,000-square-foot space at Vornado Realty Trust’s 731 Lexington Ave, which is nearby on 59th street.  Instead, it will occupy the 120,000 square feet, four-story space at 410 E. 61st Street on 1st Avenue. “We believe this location will be more convenient for residential neighborhoods and look forward to continuing to serve our customers on the Upper East Side,” a Home Depot spokesperson had previously told Patch.