A Canadian lender has completed its first New York acquisition with the purchase of a pair of properties on a well-known Greenwich Village street.
Toronto-based Owemanco has bought Nos. 51 and 57 W. Eighth St. for a total of $8.8 million in two deals that closed March 7 and that were made public in the city register Thursday. Both sites went into contract in October.
No. 51, a mixed-use, prewar walkup with 16 rental apartments and a vacant retail space, traded for $3.7 million, while nearly identical No. 57, which has 16 rental apartments but a massage business in its storefront, went for $5.1 million, the register shows.
The sellers, the Grundwerg family, who owned the buildings for decades, initially had much higher expectations for the properties. Steven Grundwerg listed both in 2023 for a total of $13.6 million and so ended up unloading them for 35% less.
What seems to have depressed their worth is that all but one of the buildings’ 32 units were rent-regulated, said Jonathan Schwartz, the broker with Meridian Capital Group who represented Owemanco in the transactions.
Owners of rent-stabilized buildings have struggled to raise rents after 2019 pro-renter laws made it tougher to pass on renovation costs to tenants, among other actions. The laws also seem to have forced the values of some multifamily sites to tumble.
“Rent-stabilized properties are now viewed as a declining asset,” said Clint Olsen, the JLL managing director who marketed the sites. “It’s definitely an uphill battle.”
Schwartz told Crain’s that Owemanco is expected to hold the sites for the long term. A studio at No. 51 leased for $2,600 this month, according to StreetEasy, while a studio at No. 57 found a taker for $2,500 in August.
It’s not clear exactly how the Grundwergs made out in the deals. Steven’s father, the late Saul Grundwerg, appears to have bought No. 51 in 1986 for about $500,000, according to the register. He took control of No. 57, meanwhile, in 1983 for about $150,000, a deed shows, but that amount may reflect what he paid to buy out previous partners. Neither site appears to have been carrying any mortgage debt at the time of the sale.
A bohemian hub of the counterculture in the 1960s—Jimi Hendrix chose the street for his still-humming Electric Lady Studios—West Eighth between Fifth and Sixth avenues saw its head shops give way to midmarket shoe stores in subsequent decades. But developers have gradually begun muscling onto the landmarked strip in recent years.
Last fall, for instance, the firm T30 Capital filed plans to demolish a former Goodwill store that sits across the street from Owemanco’s new properties.
Adam Tobe, the chief investment officer for Owemanco, which is a portmanteau for the Ontario Wealth Management Corp., did not return an email seeking comment by press time. And a message left for Grundwerg at his New Jersey law firm, Sabaitis & Grundwerg, was not returned by press time.
