72-Unit, Rent-Stabilized Bronx Apartment Building Sells
A six-story, 72-unit elevator building located in the Morris Heights neighborhood of the Bronx has sold for $11.5 million, or $159,000 per unit, according to Meridian brokers Amit Doshi and Shallini Mehra, who represented the seller.
The rent stabilized property went through a mod rehab program in 1984 and entered into a Project Based Section 8 Contract for 20 years, which expired in 2004. As part of the conversion out of the program, tenants were issued Enhanced Section 8 Vouchers, which are substantially favorable than a regular public housing agency’s (PHA’s) basic voucher.
“We sold this property just two years ago, when it had been under a 35+ year ownership. The current sellers decided to divest this asset due to internal restructuring,” Ms. Mehra commented.
“Since the vouchers secure over 80% guaranteed rents as well as the flexibility of moving tenants, the buyer had an additional incentive to acquire an asset that was not only well-maintained but also required no capital expenditures. The maneuverability of the legal rents versus preferred rents becomes a lot easier in this case,” added Mr. Doshi.
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