Phoenix, Orbach Form JV to Own Midtown Manhattan MF
- Mar 24, 2011
New York–Phoenix Realty Group and the Orbach Group have formed a partnership that has acquired an interest in a 13-building residential portfolio on West 49th Street in Manhattan, across from from World Wide Plaza. Owned and operated by Orbach since 2008, the 13 five-story walkups, which total 253 apartments, are on a single block between 8th and 9th Avenues and offer a mix of market-rate and rent-stabilized units.
The investment was made on behalf of a Phoenix Realty Group institutional real estate fund focused on residential assets in and around New York City. The pre-war apartments were 99 percent occupied as of the closing of the investment.
“The capital infusion by Phoenix enabled us to refinance the mortgage on the property, which will save us millions,” Meyer Orbach, president of the Orbach Group, tells MHN. “Also, we can use the savings to upgrade the portfolio, which ultimately will generate an even more favorable return.”
Orbach adds that the partnership will have benefits beyond this particular portfolio. “Multifamily pricing has become much more attractive in the last six months,” he says. The capital infusion “provides Orbach with additional capital that we can use to take advantage of some of the attractive deals in today’s market, in New York as well as in our other target markets of New Jersey and Pennsylvania.”
The Orbach Group currently owns over 3,500 apartment units in those three markets, specializing in acquiring and repositioning properties in high barrier-to-entry markets. Phoenix pursues multifamily acquisition and development in southern California and in New York, New Jersey and Connecticut, tapping $400 million in discretionary institutional fund capital targeted for those areas. In the second half of 2010 alone, the firm acquired more than 2,100 apartment units nationally, valued at $250 million.