Foundations Underway For COOKFOX’s 335 Eighth Avenue In Chelsea, Manhattan

Foundations are underway at 335 Eighth Avenue, the site of a seven-story mixed-use building in Chelsea, Manhattan. Designed by COOKFOX Architects and developed by MAG Partners and Penn South aka Mutual Redevelopment Houses, Inc., with financing provided by global holding company Safanad, the structure will span around 200,000 square feet and yield 188 rental units in studio to two-bedroom layouts, as well as a 23,000-square-foot Lidl supermarket and additional ground-floor retail space. Thirty percent of the homes will be reserved for affordable housing. Urban Atelier Group is the general contractor for the property, which is located at the corner of Eighth Avenue and West 26th Street within the Penn South affordable housing cooperative, officially known as Mutual Redevelopment Houses.

Demolition had just finished at the time of our last update in early October, when the plot sat cleared and awaiting the start of excavation. Since then, crews have already created various sections of the new reinforced concrete foundations around the eastern corner while excavators continue to unearth the remainder of the rectangular parcel. The superstructure could likely start to rise above street level in late spring to early summer.

A new rendering has also been released showing the eastern elevation. The building is depicted with a red brick envelope, a grid of recessed rectangular windows, and tall floor-to-ceiling windows for the retail frontage. The residential entrance sits beneath a canopy topped with shrubbery along Eighth Avenue, and dark metal railings line the expansive rooftop terrace.

The Lidl supermarket will feature a bakery, fresh produce, a floral shop, meat and seafood, and other typical everyday essentials. The store will be the German company’s second outpost in Manhattan following a Harlem location at 2187 Frederick Douglass Boulevard that opened in February 2022. YIMBY last reported that Lidl is expected to work with Hire NYC to offer employment to local residents and provide comprehensive benefits such as healthcare for all full- and part-time employees, regardless of hours worked per week.

Ninety percent of the units will be studios and one-bedrooms, and the remaining 10 percent will be two-bedroom apartments. Residential amenities at 335 Eighth Avenue will include a fitness center, library, media lounge, coworking lounge with private workspaces, a dining area with a catering kitchen, and rooftop gardens with dining areas and a grilling terrace.

In recent news, JLL Capital Markets arranged a $151.4 million capitalization for the project with financing secured from Bank OZK and MetLife Investment Management. The property is a short walk from the local C and E trains at the 23rd Street station to the south.

335 Eighth Avenue’s anticipated completion date is slated for the third quarter of 2025.

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Demolition Prep Underway At 335 Eighth Avenue In Chelsea, Manhattan

BY: MICHAEL YOUNG 8:00 AM ON JUNE 18, 2023

Demolition preparations are underway at 335 Eighth Avenue, the site of an upcoming seven-story residential building in Chelsea, Manhattan. Designed by COOKFOX and developed by MAG Partners, the 200,000-square-foot structure will yield 188 residential units with 30 percent dedicated to affordable housing for low- and middle-income residents under the Affordable NY Program, as well as a 23,000-square-foot Lidl grocery store on the ground floor. Titan Industrial SVC Corp is the demolition contractor and Urban Atelier Group is the general contractor for the property, which is located at the corner of Eighth Avenue and West 26th Street within the Penn South affordable housing cooperative, officially known as Mutual Redevelopment Houses.

Recent photographs show sidewalk scaffolding set up around the perimeter of the current occupant of the site. Black netting should soon be assembled over the rest of the structure, and demolition will likely unfold quickly given the building’s modest low-rise scale.

Photo by Michael Young

Photo by Michael Young

Photo by Michael Young

Photo by Michael Young

Photo by Michael Young

Photo by Michael Young

The main rendering depicts 335 Eighth Avenue clad in red brick with floor-to-ceiling windows and several stepped setbacks topped with landscaped terraces on the upper levels. A pair of short mechanical bulkheads cap the structure, and the ground floor will feature oversized windows for the retail frontage.

YIMBY last reported that the Lidl supermarket will feature a bakery, fresh produce, a floral shop, meat and seafood, and other everyday essentials. The store will be the company’s second location in Manhattan, following a Harlem market that opened in February 2022. Lidl is expected to work with Hire NYC to offer employment to residents in the local community and provide comprehensive benefits such as healthcare for all full- and part-time employees, regardless of hours worked per week.

The property is a short walk from the C and E trains at the 23rd Street station.

Demolition is anticipated to wrap up in the third quarter of 2023, and the new residential development and Lidl are expected to open in 2026.

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Five Questions With: MaryAnne Gilmartin Founder & CEO, MAG Partners

When Real Estate In-Depth pondered who would be the candidate for the Five Questions feature for Women’s Month, the logical choice was MaryAnne Gilmartin.

Her background in real estate as she tells it almost began by happenstance, but her hard work has led her to found her own New York City-based real estate development firm—MAG Partners—in 2020 that in a short time has built a $1-billion pipeline.

The Fordham University graduate (undergraduate and graduate degree) began her career with the New York City Public Development Agency (the predecessor to the New York City Economic Development Corp.) and since then has held chief executive positions with some of the country’s leading development firms, including Forest City Ratner and Mack-Cali Realty Corp. She has overseen a host of high-profile projects and has been frank about who has guided her and now pays it forward and mentors others in their real estate careers.

Gilmartin, who serves as a special advisor to Fordham Real Estate Institute’s Executive Advisory Council, recently said at a “She Builds” session held at the university’s Lincoln Center campus, “I’ve built my career trying to bump up against what people think of as a developer and identify more with ‘placemaker.’ If I use the word ‘developer,’ I refer to myself as a ‘civic developer’ because what we do is contribute to civic life and with that comes a great responsibility. I’d love the word developer to mean all that I know that it is, which is a person who creates place, changes the skyline and the ground plane in cities, and builds something of lasting quality that impacts the lives of the community in which it exists.”

Gilmartin served as President and CEO of Forest City Ratner Companies, where she oversaw a host of game-changing ground-up developments and managed its multimillion square foot residential, commercial and retail portfolio. She also served as Chair of the Board of Directors and interim Chief Executive Officer of Mack-Cali Realty Corporation.

In her tenure at Forest City Ratner Companies, she spearheaded the development of some of the most high-profile real estate projects in New York City. She led the efforts to build Barclays Center, the state-of-the-art sports and entertainment venue and the centerpiece of the $4.9 billion, 22-acre mixed-use Pacific Park Brooklyn development.

She also oversaw the development of The New York Times Building, designed by world-renowned architect Renzo Piano; New York by Gehry, designed by award-winning architect Frank Gehry; and the Tata Innovation Center at Cornell Tech, a new office building that is a first-of-its-kind space for tech innovation, designed by Weiss/Manfredi on Roosevelt Island. During her tenure at Forest City, the firm also developed Ridge Hill in Yonkers.

Today, MAG Partners is developing a number of distinctive projects, including 281 West 28th Street, a mixed-income residential building designed by COOKFOX that will begin leasing in early 2023. In addition, the company is developing two other residential buildings and a boutique office building in Hudson Square. In partnership with Sagamore Ventures, Goldman Sachs Asset Management and MacFarlane Partners, MAG Partners is leading the development of Baltimore Peninsula, a 235-acre masterplan in Baltimore, MD. In 2023, 1.1 million square feet of office, retail and residential development will open on a prime waterfront location.

Gilmartin is a civic leader in the New York metropolitan area, serving as Chair Emeritus of the Downtown Brooklyn Partnership, a member of the Board of Trustees of The Brooklyn Academy of Music, a member of the New York Public Radio Board of Trustees, and a member of the Executive Committee and Board of Governors of The Real Estate Board of New York. At Columbia University, she is part of the Industry Advisory Board of the MS Real Estate Development Program as well as a member of the real estate advisory board in the Center for AI in Business Analytics & FinTech. In addition to her civic and industry board service, she was appointed a member of the board of directors of the global investment banking firm Jefferies Group LLC in 2014.

Real Estate In-Depth: Your background in real estate is very impressive, rising to president and CEO of Forest City Ratner Companies, serving as chairman and interim CEO of Mack-Cali Realty during a tense shareholder battle and founding your own real estate development company MAG Partners three years ago. Can you tell us what led you into the industry and what have been your keys to success in what has been a male-dominated industry?

Gilmartin: I call myself an accidental developer because this career path relied on serendipity. I had no inkling of what I wanted to be when I grew up, but coming out of university, I landed an Urban Fellow fellowship. I was assigned to New York City’s Public Development Agency, which is now the Economic Development Corporation. My plan was to spend a summer with them, and then go off to law school in September and fight for the rights of juveniles in the justice system.

At the Public Development Agency, I discovered that I had real estate development in my veins. At the time, leadership at PDC would challenge the team by saying, “Let’s look at the West Side, what should we do with it?” It was an incredible place to start a career and my path to meeting Bruce Ratner with whom I would work for the next 25 years.

My career grew in a meritocracy. Bruce always chose the best man or the best woman for the job. So, I always made sure to know the most, be the most prepared and worked the hardest. I never had my eye on the corner office, but it turns out, in a meritocracy, if you prove yourself, you can get the top job.

After serving as CEO at Forest City Ratner, I set out to build a company that looks a little more like the community for which we build, MAG Partners. This of course is a very simple statement, but I clearly have been a little bit of an anomaly in the business in a way that I wish I wasn’t.

Real Estate In-Depth: Were there people who were your mentors and/or helped you along the way in your career. If so, please explain?

Gilmartin: Mentoring has played an outsized role in my professional evolution. The role of mentor or mentee is critical to the career development of the women in our field, and I take my own responsibility seriously when I meet young women who want to get into the industry. My two most influential mentors have been Bruce Ratner and Mary Ann Tighe (CBRE). With both in my corner, I hit the career lottery. Because of the profound impact mentoring has had on my career, I have vowed to always be a mentor to others in order to pay it forward.

Real Estate In-Depth: What would you say were the obstacles you faced and women still must overcome in the commercial development arena and what advice do you have for women in commercial real estate?

Gilmartin: While I have said many times before that I never got that email that said, “you’re a woman so you should feel really intimidated” in this industry. But again, that is because I was part of a meritocracy and it was always the best man or woman for the job with Bruce Ratner. My advice is to be the most prepared and to not be afraid to show off your stuff.

Real Estate In-Depth: You recently began leasing MAG Partners’ first project—Ruby—a 480-unit residential project at 243 West 28th St. in Chelsea. In a short time, MAG Partners has built an impressive pipeline with projects planned at 335 Eighth Avenue, 300 East 50th St.; 122 Varick St. in the Hudson Square District; 44-02 Vernon Blvd. in Long Island City, as well as MAG Partners’ participation in the 1.1-million-square-foot Baltimore Peninsula Project. From what I understand, all of your New York City projects qualified for the now expired 421a tax incentive. Will the lack of 421a inhibit development in New York City in years to come if not reinstated in some form?

Gilmartin: Absolutely. But in the more near term, we are extremely focused on an extension to the deadline to complete these projects, something Governor Hochul put forward in her budget. This deadline is not just important to my company and the projects we have moving—the danger of missing the 2026 deadline is putting 33,000+ units in jeopardy of not moving forward. With the current challenges in the markets, it is critical that the legislature extend the deadline for vested projects.

Real Estate In-Depth: Does MAG Partners have any plans to enter other markets in the New York City metro area, specifically the lower Hudson Valley?

Gilmartin: The great thing about being a private company is that we can be opportunistic. We want to be rational and strategic, and we are not confined to New York City.

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MAG Partners Launches Leasing at its First New York City Building, Ruby

Designed by renowned global architecture firm COOKFOX Architects, luxury rental project Ruby embraces the history and influences of the Garment District while offering a modernized luxury living experience in one of Manhattan’s most desirable neighborhoods

Link to renderings here

NEW YORK (February 27, 2023) – Woman-owned leading real estate company MAG Partners today announced the launch of leasing at Ruby, a residential development located at 243 West 28th Street in Chelsea. Located across the street from the Fashion Institute of Technology (FIT) between Seventh and Eighth Avenues, within New York City’s Garment District, Ruby offers 480 studio to three-bedroom residences amongst two towers – 30 percent of which are reserved for affordable housing – in addition to 8,500 square feet of ground-floor retail space.

Named after fashion designer Ruby Bailey, an expressive visual and performance artist and master beader, Ruby is MAG Partners’ first New York City project and the first in a portfolio of residential buildings to be named after historical and influential women.

“MAG Partners is built upon the principles of beauty, diversity, inclusion and sustainability, all of which are reflected within the living experience at Ruby,” said MaryAnne Gilmartin, Founder and CEO of MAG Partners. “As a firm founded in New York, we couldn’t be more excited to open this passion project in our own backyard. We are proud that our first building is providing much-needed housing in our city and offers thoughtfully designed residences focused on health and wellness.”

Designed by globally renowned architecture firm COOKFOX Architects, the 22-story and 23-story towers’ architectural expression is inspired by the historic fabric of the turn-of-the-century Garment District neighboring buildings, incorporating biophilic elements throughout its amenities. The thoughtful design pays tribute to creatives in the garment industry like Bailey, a Bermudian immigrant who led an artistic life in NYC. In addition to her eclectic fashion and clothing designs, she also created a series of doll-sized “mannequins” which today are part of the permanent costume collection in the Museum of the City of New York. She lived in Harlem until her death in 2003 at the age of 97.

“Our design for Ruby was inspired by the forms and patterns of Garment District masonry structures and the warp and weft of woven textiles. These historical elements lend a sense of authenticity to the new residences and elevate residential design in the neighborhood,” said Rick Cook, Founding Partner of COOKFOX Architects. “The attention to craft and amenities at Ruby that connect residents to outdoor space and gardens brings nature-connected living into one of the busiest areas of Manhattan.”

Each of the residences within Ruby are thoughtfully appointed with sophisticated details. Kitchens are designed with integrated Bosch appliances with herringbone backsplash, harkening back to the textile context. The bathrooms also feature porcelain herringbone tiles, with ceramic subway tile walls and extra-wide built-in medicine cabinets. All units include a Bosch stacked washer and dryer, three-layer, 5-inch-wide engineered oak wood flooring, keyless unit entry door hardware, Nest thermometers, solar shades throughout (including blackout shades in the bedrooms) and generous closet space. Approximately 10 percent of units have private outdoor space. 

The approximately 19,000-square-foot robust amenity package includes an array of indoor/outdoor offerings. In addition to a rooftop pool, roof lounge and grilling terrace, there is a club lounge with dining and entertainment areas, a library lounge with coworking and meeting spaces, a landscaped courtyard and lobby garden, a 5,000-square-foot, two-floor fitness center with cardio and weight training facilities, and more.

The Ruby facade is contextual masonry inspired by the rich historic architectural fabric of the neighborhood featuring hand-laid brick, richly patterned surfaces and narrow setbacks. While the exterior evokes the neighborhood’s industrial past, the interior lobby and amenity spaces provide tranquil moments promoting wellbeing including warmly-lit wood panels, angled millwork, custom panels and diffused interior lighting. The two towers are anchored by a courtyard – a private sanctuary overlooking a landscaped lobby garden, connecting the residents to nature. 

Ruby incorporates high-performance building systems that optimize energy performance, enhance indoor air quality, and improve acoustic performance to provide residents with the ultimate luxury – an urban sanctuary. Along with all of the outdoor spaces, daylighting of corridors, and the use of natural materials and patterns in design, the sustainability strategies will contribute to the building’s LEED Silver certification.

“We are thrilled to be a part of MAG Partner’s inaugural project. The thoughtfully designed and constructed development brings much-needed affordable and market-rate housing to Chelsea,” said Andy D’Amico, president and CEO of Urban Atelier Group, which is leading the construction management of the project. “Ruby is the perfect model for housing in the 21st century with a design rooted in the neighborhood’s architectural fabric and sustainable strategies that connect residents to nature. The project’s success would not have been possible without the trust and transparency between our partners to help bring the vision to life.”

To further honor Bailey, MAG Partners has partnered with The Social Justice Center at FIT – a first-of-its-kind initiative in higher education seeking to address the systemic problems faced by BIPOC youth, college students, and working professionals in the fields that drive the creative economy – to offer a scholarship for BIPOC FIT students.

“We are proud to honor the life of Ruby Bailey and the contributions she made as a Black female artist who built a lifelong career in New York City,” Gilmartin added. “The partnership with FIT will allow her legacy to live on through the lives of the next generation of BIPOC creatives looking to make their mark in the city.”

Founded by seasoned real estate professional Gilmartin, MAG Partners was formed in 2020 as a 21^st century national urban development company dedicated to diversity and inclusivity in the real estate industry. The Ruby announcement comes on the heels of MAG Partners’ 2022 successful launch of its Baltimore Peninsula project in Baltimore, Maryland, a 235-acre master plan designed for impact on a post-industrial waterfront peninsula in central South Baltimore. The project is being developed in partnership with Sagamore Ventures, Urban Investment Group within Goldman Sachs Asset Management and MacFarlane Partners.

Other NYC projects in the works for MAG Partners include nearby 335 Eighth Avenue, a mixed income, 190-unit apartment building with ground floor commercial space; 300 East 50th Street, a 194-unit multifamily building with ground floor retail at the corner of Second Avenue; and 122 Varick Street, a 175,000-square-foot boutique office development. The female names of the future residential buildings will be unveiled closer to their launches.

Ruby is conveniently located within walking distance to Penn Station which includes access to nearly every NYC subway line in addition to the Long Island Railroad, New Jersey Transit, PATH and Amtrak. Residents will enjoy easy access to the city’s leading restaurants, entertainment venues, shopping and more.

“Having worked with MAG Partners and the entire design team from inception, Douglas Elliman Development Marketing is proud to represent Ruby and bring to market this best-in-class rental development,” said Matthew Villetto, Executive Vice President, Douglas Elliman Development Marketing. “The integration of wellness, biophilic aspects, high design and finishes, unparalleled amenities and services, contextual architecture, stunning views and more have resulted in an end-product and experience that will undoubtedly stand out in the marketplace and exceed renter expectations.”  

The project is a joint venture between MAG Partners, Safanad, Atalaya Capital Management and Qualitas. MAG Partners previously announced that it has secured a $173 million construction loan from Madison Realty Capital for the project.

Market-rate studios at Ruby begin at $4,500 per month. Douglas Elliman Development Marketing is the exclusive marketing and leasing agent for Ruby. For more information, please visit rubychelsea.com or (212) 551-RUBY.

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About MAG Partners

MAG Partners is a woman-owned, urban real estate company with decades of experience developing impactful, iconic, large-scale projects throughout New York City. Led by MaryAnne Gilmartin, together the MAG Partners team has successfully designed, built and operated over 7 million square feet of office, residential and mixed-use projects, including over 2,000 units of housing, with a total value of over $4.5 billion. The firm believes and has proven that principles of beauty, diversity and sustainability create lasting value.

About COOKFOX Architects

COOKFOX Architects is a New York based architectural and interior design studio. COOKFOX has built a studio focused on high-performance, environmentally responsive, socially engaged design. The studio is well-known for innovative design that supports physical health and mental wellness at the highest standards of environmental performance. With a portfolio of diverse residential, workplace, and education projects, COOKFOX seeks to pursue architecture that restores, regenerates, and elevates our collective experience of the urban environment. www.cookfox.com

About Douglas Elliman Development Marketing (DEDM)

Douglas Elliman Development Marketing, a division of Douglas Elliman Real Estate, offers unmatched expertise in sales, leasing, and marketing for new developments throughout New York City,  Long Island, Westchester, New Jersey, Florida, California, Massachusetts, and Texas. The company’s new development hybrid platform matches highly experienced new development experts with skilled brokerage professionals who provide unparalleled expertise and real time market intelligence to its clients. The firm is heralded for its achievements in record breaking sales throughout each of its regions. Drawing upon decades of experience and market-specific knowledge, Douglas Elliman Development Marketing offers a multidisciplinary approach that includes comprehensive in-house research, planning and design, marketing, and sales. Through a strategic global alliance with Knight Frank Residential, the world’s largest privately-owned property consultancy, the company markets properties to audiences in 61 countries, representing an over $87 billion global new development portfolio. https://www.elliman.com/marketing

About Urban Atelier Group

Urban Atelier Group (UAG) is a boutique construction management firm based in New York City. UAG’s culture is rooted in the ethos of an atelier – the team views itself as a creative workshop where each member has a voice and the ability to elicit change.Founded by President and CEO Andy D’Amico and Executive Vice President and Operations Manager, James Palace, the firm emphasizes a collaborative process, working with key stakeholders to build beyond construction drawings. The firm’s portfolio of distinguished work is defined by analytic problem-solving and transparency, constructing innovative designs with unparalleled service. https://www.uag.nyc/

Ruby Nears Completion At 241 West 28th Street In Chelsea, Manhattan

Exterior work is nearing completion on Ruby, a 22-story two-tower residential complex at 241 West 28th Street in Chelsea. Designed by COOKFOX and developed by MAG Partners, Atalaya, Safanad, and Qualitas, the 400,000-square-foot project will yield 480 rental units with 144 reserved for low- and middle-income households, as well as 8,500 square feet of ground-floor retail space. Urban Atelier Group is the general contractor for the property, which is located on a through-block parcel between Seventh and Eighth Avenues with frontage on both West 28th and 29th Streets. The developers are aiming for LEED Silver certification.

Since our last update in October, the construction elevator has been dismantled from the West 28th Street elevation and the gap in the façade has been filled in. Nearly all of the 100,000 square feet of bricks have been laid by King Contracting Group and the mostly blank western sides of both towers are now clad in their final EIFS enclosure. Only minor work remains to be completed around the ground floor and upper levels. Belden Tri-State supplied the brick on this one and Cladding Concepts supplied the decorative railings.

More of the decorative railings have been put in place across the second level and eastern end of the building, and dark spandrels have been installed across the upper levels. Sidewalk scaffolding still surrounds the northern and southern ground-floor frontage but should be removed in the coming weeks once exterior work wraps up.

The below images show the look of the interior sides of the towers, which feature metal paneling lining their central cores.

Homes come with in-unit washers and dryers, central AC, and name-brand kitchen appliances. Amenities at Ruby include a dog-washing station, a media room, multiple indoor lounges, fitness center, children’s playroom, laundry room, bike storage, live-in superintendent, a 24/7 attended lobby, and an outdoor lounge with a swimming pool and an adjoining terrace.

The nearest subway is the local 1 train at the 28th Street station to the east along Seventh Avenue. Also nearby is the 34th Street-Penn Station complex with access to the A, C, E, 1, 2, and 3 trains, Long Island Rail Road, New Jersey Transit, and Amtrak.

241 West 28th Street is anticipated to be completed this summer.

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MAG Partners Buys Ground Lease for Residential Co-Op Redevelopment

MaryAnne Gilmartin’s MAG Partners has purchased the $63.8 million leasehold for 335 Eighth Avenue from Penn South and plans to turn the site into a mixed-income apartment building.

MAG Partners signed a 99-year ground lease for the property — currently a retail building that formerly housed a Gristedes supermarket — in a joint venture with real estate equity firm Safanad. The JV plans to redevelop the building into 188 units of affordable housing with ground-floor commercial space, The Real Deal first reported.

The commercial building in Penn South, a 10-building mixed-income complex between West 23rd and West 29th streets that has faced financial woes, will be demolished while a new rental development will bring a grocery store to the area in the planned retail space, according to MAG Partners. Penn South tapped MAG Partners to lead the development last year.

“The co-op was faced with a decision to make, after a thorough assessment from our professional engineers and real estate consultants,” Ryan Dziedziech, general manager of Penn South, said in a statement. “Either we seek additional very costly loans in order to address major capital repairs to this two-story aging commercial building or enter into a long-term ground lease with a responsible developer who will demolish the existing building and build an affordable, quality housing building that will blend into the fabric of the community and guarantee our limited equity co-op cash flow for many years to come.”

Gristedes, Midtown Tennis Club, Asylum Comedy Club and McDonald’s were previous tenants whose leases expired in the commercial building at the end of 2022, according to TRD.

Demolition of the existing structure will begin in the first quarter of this year followed by construction of a 200,000-square-foot, seven-story building designed by architectural firm Cookfox. Construction will start in the third quarter of 2023, according to MAG Partners.\

The sale of the leasehold will allow the co-op, officially known as Mutual Redevelopment Houses, to make capital improvements to remaining sections of the campus while keeping monthly maintenance fees low for shareholders and providing additional services to its estimated 5,000 residents. The deal could contribute as much as $750 million to the co-op over the length of the 99-year term, TRD reported.

“[We] look forward to starting a new mixed-income residential building that will contribute to the co-op’s beautiful campus and provide critical income to its mission,” Gilmartin said in a statement.

Mark Hallum can be reached at [email protected].

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MAG Partners clinches 99-year Chelsea ground lease; MaryAnne Gilmartin’s firm to deliver 188 units with Penn South co-op

MAG Partners has closed on a 99-year ground lease for a Chelsea development site.

MaryAnne Gilmartin’s three-year-old firm inked a deal on the northwest corner of Eighth Avenue and West 26th Street with Mutual Redevelopment Houses.

The parties declined to discuss the financial terms for the deal. Sources told The Real Deal the lease starts with an annual rent of around $2 million and has yearly rent increases that are expected to bring in over $750 million during the life of the deal.

The Memorandum of Lease reviewed by TRD shows a consideration of just under $64 million. For transfer tax purposes, this number represents the estimated fair market value of the site if it were sold but does not reflect the expected rent over its term. The city received just under $415,000 in taxes.

Mutual, also known as Penn South, is a 10-building Mitchell-Lama housing cooperative in Chelsea that sprawls from West 23rd to West 29th streets, between Eighth and Ninth avenues.

MAG Partner’s new project at 335 Eighth Avenue will rise seven stories and host 188 units in the mixed-income apartment building, along with ground-floor commercial space.

The 200,000 square-foot building was designed by COOKFOX Architects.

To qualify for the previous Affordable NY Program and assure 30 percent of the units would be affordable to low-and-middle class households, the necessary footing was installed in early 2022 with the blessing of the co-op and prior to the expiration of the program.

The retail building previously included a Gristedes, the Midtown Tennis Club, the Asylum Comedy Club and McDonald’s, all of which had leases timed to expire at the end of 2022.

Demolition will begin in the first quarter of 2023 with construction during the third quarter.

This is the second deal for MAG Partners and its real estate private equity venture partner, Safanad, after developing almost 700 housing units in Manhattan, including the nearby 241 West 28th Street.

Penn South’s retail building had brought in nearly $2 million in lease revenue before taxes and repairs, enabling a reduction in maintenance fees for its resident shareholders. But when engineers said the structure needed almost $50 million in repairs to become marketable to modern tenants, it would have caused each of the 2,820 units to pay additional assessments averaging $500 per month for three years.

Penn South hired Paul Travis of Washington Square Partners to solicit proposals for the site. After culling the responses, cooperators voted in 2021 among three choices that included redeveloping the site; a taller, all-commercial project by another developer; and Mag Partners’ proposal, which offered nearly twice as much over the lease term including yearly bumps in rent.

Susi Yu and Jeff Rosen led the deal for the MAG Partners team while Joshua Stein of Joshua Stein PLLC represented Mag Partners in the legal work for the transaction.

Dena Cohen, a partner with Herrick Feinstein, represented Penn South in the lease negotiations.

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MAG Partners Closes Transaction to Develop Residential Building in Chelsea

MAG Partners, the woman-owned development firm, announced today that they closed on the leasehold acquisition for 335 Eighth Avenue with Penn South, an affordable housing cooperative located in the Chelsea community of Manhattan. 335 Eighth Avenue will be a mixed-income apartment building with ground floor commercial space, including a grocery store.  

The deal represents a second closing for the partnership between MAG Partners and Safanad, a real estate private equity firm. In 2020 the two firms announced their JV to pursue New York metropolitan area real estate together. They now have nearly 700 units of housing in development in Manhattan. 

The new 188-unit building will be developed under the Affordable NY Program with thirty percent of its units reserved for low-and-middle income New Yorkers.  The team secured the necessary footing for program inclusion in early 2022 and demolition will begin in the 1st quarter, 2023 followed by construction in the 3rd quarter, 2023.    The contextual 200,000 square foot, 7-story building is designed by renowned local architects COOKFOX.  

“We are proud to reach this important project milestone with Penn South and look forward to starting a new mixed-income residential building that will contribute to the coop’s beautiful campus and provide critical income to its mission,” said MaryAnne Gilmartin, Founder and CEO of MAG Partners. “We are grateful for our continued development relationship with Safanad who is building a second rental community in partnership with us.”

“Our close on the 8th Ave transaction demonstrates our continued faith in the strength of the New York City multifamily rental market; the project builds on our deep and successful partnership with MAG Partners, as already exhibited by our joint ground-up development project on 28th Street,” said Andrew Trickett, Partner and Head of Investments at Safanad.

Penn South, also known as Mutual Redevelopment Houses, initiated a process to identify and select a development partner to transform a corner parcel with a commercial building that required significant repairs.  The ground lease payments will support Penn South’s core objective to maintain long-term affordability and quality of life for its nearly 5,000 residents.  Washington Square Partners represented Mutual in the transaction.

“The revenue generated from this new partnership with MAG Partners will provide critical funds that permits our co-op to pay for capital improvements around our aging campus, keep monthly maintenance charges affordable, and support vital services and care that our residents depend on,” said Board President Ambur Nicosia.

“The coop was faced with a decision to make, after a thorough assessment from our professional engineers and real estate consultants: either we seek additional very costly loans in order to address major capital repairs to this two-story aging commercial building or enter into a long-term ground lease with a responsible developer who will demolish the existing building and build an affordable quality housing building that will blend into the fabric of the community and guarantee our limited equity coop cash flow for many years to come,” said General Manager Ryan Dziedziech.

Susi Yu and Jeff Rosen led the deal for the MAG Partners team. The parties were represented by Joshua Stein and Alexa Klein of Joshua Stein PLLC and Dena Cohen and Francesca Venezia of Herrick, Feinstein LLP.

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About MAG Partners: MAG Partners is a woman-owned, urban real estate company with decades of experience developing impactful, iconic, large-scale projects throughout New York City.  Led by MaryAnne Gilmartin, together the MAG Partners team has successfully designed, built and operated over seven million square feet of office, residential and mixed-use projects, including over 2,000 units of housing, with a total value of over $4.5 billion. Their current multi-million square foot development portfolio includes three multifamily rental buildings and a ground-up commercial development in Manhattan and a master plan redevelopment in Baltimore.

About Safanad: Safanad is a global principal-led investment house established in 2009 with offices in New York and the Dubai International Financial Centre (DIFC). The firm has executed over 40 transactions worth over US$10 billion since inception and built market-leading platforms in the US and Europe in education, healthcare, digital infrastructure, and real estate. Today, it is the owner of the largest UK care home operator with over 15,000 residents, a leading global education provider serving ~50,000 students worldwide, and a major operator of data centers across the US. Deploying its own capital, alongside strategic partners and investors, Safanad executes across greenfield / development, turnaround, and roll-up strategies. Its partners and co-investors include leading publicly listed companies, sovereign wealth funds, and institutions from the US, Europe, and Middle East. Safanad is a registered investment advisor with the U.S. Securities and Exchange Commission (SEC) and regulated by the Dubai Financial Services Authority (DFSA).

About Penn South: Penn South (legal name Mutual Redevelopment Houses, Inc.), is an affordable housing cooperative that is self-managed and overseen by its 15-member Board of Directors and subject to the regulatory jurisdiction of the New York City Department of Housing Preservation & Development.  Penn South contains 2,820 apartments with close to 5,000 residents in 15 buildings on a site bounded by Ninth Avenue, West 23rd Street, Eighth Avenue and West 29th Street in Manhattan.  

241 West 28th Street’s Brick Façade Nears Completion In Chelsea, Manhattan

Façade work nears completion on 241 West 28th Street, a pair of 22-story residential buildings in Chelsea, Manhattan. Designed by COOKFOX and developed by MAG Partners, Atalaya, Safanad, and Qualitas, the 400,000-square-foot complex is aiming for LEED Silver certification and will yield 480 units with 30 percent reserved for low- and middle-income households, as well as 8,500 square feet of ground-floor retail space. Urban Atelier Group is the general contractor for the property, which is located between Seventh and Eighth Avenues with frontage on both West 28th and 29th Streets.

At the time of our last update in May, the red brick façade had reached up to the height of the setbacks on the 28th and 29th Street elevations. Since then, crews from King Contracting Group laid the remainder of the 100,000 square feet of brick, supplied by Belden Tristate Building Materials, at a pace of one floor every two and a half days. The eastern side of the building has been enclosed in its EIFS envelope, and metal railings have begun to be installed at the base of some of the windows, with clips in place at their tops to hold a decorative paneling.

Scaffolding rigs hang from both the northern and southern sides of 241 West 28th Street as workers continue to finish up the exterior. The construction elevator remains attached to the West 28th Street elevation.

The towers on the western end of the building are awaiting their EIFS enclosure. Densglass sheathing insulation boards and the edges of each floor plate remain exposed for now.

Residential amenities include multiple indoor lounges, a fitness center, a children’s playroom, and an outdoor lounge with a swimming pool and adjoining terrace.

YIMBY last reported that 241 West 28th Street is slated for completion in July 2023.

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#45, MaryAnne Gilmartin, Founder and CEO at MAG Partners

Last year’s rank: 50

Two years into the company’s existence, MAG Partners spent 2021 constructing a massive development empire, a feat that, to founder MaryAnne Gilmartin, shows the company’s strength and resilience.

“We were able to put together a billion-dollar development pipeline, and secure those projects in a way where we have site control,” Gilmartin said. “We will have footings in three of the residential buildings in time for the expiration of [development incentive 421a], and we have capital partners committed to everything included in that pipeline. That’s an extraordinary accomplishment during one of the most challenging times in the history of New York City real estate.”

Two of the already capitalized projects in the pipeline include 335 Eighth Avenue, a 200-unit redevelopment to create an apartment building designed by Cookfox with 30 percent reserved for low- and middle-income residents, plus ground-floor commercial space; and 300 East 50th Street, a 194-unit multifamily building also with 30 percent affordable and with ground-floor retail, designed by BKSK. 

On the commercial side, MAG has raised the equity for a bespoke 200,000-square-foot office in Hudson Square at 122 Varick Street.

“It will be a building of the future, a building that recognizes what’s important for corporate America as we all return to work,” Gilmartin said. “We’re going to capture all the elements of design and operating principles that we learned through the pandemic are important: lots of collaborative spaces, outdoor space, and a beautiful building that’s healthy inside and out.”

In a confirmation of the company’s strength, MAG has doubled its employee roster in recent months, now boasting 10 employees that make the company 50 percent female.

Looking forward, in May MAG made a major announcement regarding a project called Port Covington which is part of Sagamore Ventures and Goldman Sachs’s Port Covington development in Baltimore.

“We will be stepping into a very large master-planned development of 250 acres outside of New York with a blue chip, high-quality sponsor, and a partnership with another developer that together will make us among the largest and most prolific minority development partnerships in the country,” Gilmartin said. “It’s about 14 million square feet of development in partnership with a local municipality, in a city that needs the kind of placemaking we bring.”

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