Marcus & Millichap Closes $94.5 Million Multifamily Portfolio Sale in New York City

Rhea-AI Summary

Marcus & Millichap (NYSE:MMI) has announced the sale of The Chelsea Collection, a 13-property multifamily portfolio in New York City's Chelsea neighborhood, for $94.5 million. The portfolio comprises 147 units across 98,000 square feet, trading at just under $1,000 per square foot. The NYM Group at Marcus & Millichap team, led by Joe Koicim, represented BlackSpruce Management in the sale to The Westover Companies.

This transaction marks one of the most significant multifamily sales in Chelsea this year and is the fourth portfolio transaction with assumable financing closed by the team in the last 12 months. The properties are strategically located between West 19th Street and West 29th Street. In 2023, Marcus & Millichap closed 7,546 transactions with a total sales volume of approximately $43.6 billion.

Positive

• Successful sale of major portfolio at $94.5 million, demonstrating strong market presence
• Fourth portfolio transaction with assumable financing in 12 months, showing consistent deal flow
• Team closed sales of 95 buildings in NYC in 2024, valued at over $500 million
• Company achieved 7,546 transactions worth $43.6 billion in 2023

Negative

• Operating in one of the most challenging New York City markets in years

Insights

Real Estate Investment Analyst

This $94.5 million multifamily portfolio sale in Chelsea represents a significant transaction in New York's challenging real estate market. The deal's pricing at just under $1,000 per square foot for 147 units across 13 properties reveals strong institutional interest despite market headwinds. The portfolio's successful sale with assumable CMBS financing is particularly noteworthy, as it demonstrates creative deal structuring in a high-interest-rate environment.

The transaction's strategic importance lies in its scale and location. Chelsea's position as a premium residential submarket makes this portfolio an inflation-hedge play with substantial NOI growth potential through unit turnover and strategic improvements. For context, this type of portfolio sale - multiple buildings in a prime Manhattan location with assumable debt - is increasingly rare, making it a valuable market benchmark for similar assets.

The buyer's out-of-town status (The Westover Companies) signals continued institutional confidence in New York City's multifamily sector, particularly from experienced operators looking to establish or expand their Manhattan presence. This deal structure could serve as a template for future transactions in the current market cycle, where creative financing solutions are important for deal completion.

Market Research Analyst

This transaction offers important market intelligence about New York City's multifamily sector. The portfolio's successful trade at $94.5 million during a challenging market period provides a vital pricing benchmark for similar assets. Breaking down the metrics: at approximately $642,857 per unit and just under $1,000 per square foot, these figures will likely influence future valuations in the area.

Particularly telling is the timing - Marcus & Millichap's ability to close four portfolio transactions with assumable financing in 12 months suggests a strategic shift in how deals are getting done in the current market. This adaptation to market conditions, specifically the use of assumable CMBS debt, demonstrates how buyers and sellers are navigating the high-interest-rate environment.

The transaction volume data shared ($43.6 billion across 7,546 transactions in 2023) provides valuable context about market activity levels and suggests that despite broader market challenges, significant capital continues to flow into commercial real estate, particularly in prime locations with value-add potential.

NEW YORK--(BUSINESS WIRE)-- Marcus & Millichap (NYSE:MMI), a leading commercial real estate brokerage firm specializing in investment sales, financing, research and advisory services, announced the sale of The Chelsea Collection, a 13-property multifamily portfolio of 147 units in New York City’s Chelsea neighborhood. The portfolio traded for $94.5 million, representing one of the most notable multifamily sales in Chelsea this year.

“Portfolios of this nature rarely trade in New York, and this was the fourth portfolio transaction we closed in the last 12 months with assumable financing,” said Joe Koicim, based in Marcus & Millichap’s Manhattan office. “The Chelsea Collection is comprised of quality multifamily assets located in one of the top residential sub-markets in the city that traded for just under $1,000 per square foot. The portfolio’s unique combination of location, quality, and future upside made it an attractive asset for investors looking to capitalize on New York’s market rebound.” Koicim, Logan Markley, Chris Dintrone, and Kory Barbanel all with the NYM Group at Marcus & Millichap, exclusively represented the seller, Josh Gotlib’s BlackSpruce Management, and procured the out-of-town buyer.

“With our team’s specialization in this asset type and our ability to attract outside capital, we were able to procure The Westover Companies, a well-qualified, experienced, real-estate investment group to step up and execute this portfolio in a timely manner,” said Koicim. John Wood and Rob Verrone of Iron Hound Management successfully handled the assumption process of the existing CMBS loan.

“Joe has had another phenomenal year,” said John Horowitz, head of Marcus & Millichap’s Northeast Division. “He has grown a business and a team at Marcus & Millichap that is built around his ability to develop strong personal relationships with owners. Then, once hired, Joe delivers repeatedly, resulting in one of the strongest brands in the market. In addition to this 13-property multifamily closing in Chelsea, Joe and his team closed on the sale of 95 buildings in NYC in 2024, valued at over half a billion dollars, including closings with three prominent New York real estate families. Joe did it all amid one of the most challenging New York City markets in years.”

Located on the west side of the Chelsea neighborhood between West 19th Street and West 29th Street, the buildings in the 98,000-square-foot portfolio are all within a short distance of one another. The sale of The Chelsea Collection further strengthens the ongoing demand for multifamily properties in New York City, underscoring the city’s resilience and continuing appeal to investors in the face of evolving market dynamics.

About Marcus & Millichap, Inc. (NYSE: MMI)

Marcus & Millichap, Inc. is a leading brokerage firm specializing in commercial real estate investment sales, financing, research and advisory services with offices throughout the United States and Canada. As of December 31, 2023, the company had 1,783 investment sales and financing professionals in over 80 offices who provide investment brokerage and financing services to sellers and buyers of commercial real estate. The company also offers market research, consulting and advisory services to clients. Marcus & Millichap closed 7,546 transactions in 2023, with a sales volume of approximately $43.6 billion. For additional information, please visit www.MarcusMillichap.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241224340017/en/

Gina Relva, VP of Public Relations

Gina.Relva@MarcusMillichap.com

Source: Marcus & Millichap, Inc.

FAQ

What was the sale price of The Chelsea Collection portfolio sold by MMI?

The Chelsea Collection portfolio was sold for $94.5 million.

How many properties and units were included in MMI's Chelsea Collection sale?

The Chelsea Collection included 13 properties with a total of 147 units.

What was the price per square foot for MMI's Chelsea Collection portfolio?

The portfolio traded for just under $1,000 per square foot.

How many transactions did MMI close in 2023?

Marcus & Millichap (MMI) closed 7,546 transactions in 2023, with a total sales volume of approximately $43.6 billion.

Where are the Chelsea Collection properties located in New York City?

The properties are located on the west side of the Chelsea neighborhood between West 19th Street and West 29th Street.