35-11 9th Street ("The Cigar Factory")
New York, NY
Brickman acquired the fee-simple interest in The Cigar Factory for $31.1 million ($266 per square foot) in August 2015. The Property consists of a 4 story light industrial / flex-office building totaling 116,926 square feet and a 5,000 square foot parking lot located in the Astoria submarket of Queens, NY. The Property was built in two phases, with the first phase beginning in 1896 and the second in 1930.
Property type: Office
Investment type: Equity
Size: 119,701 SF
Investment date: August 2015
The Cigar Factory represents an underperforming asset with significant upside potential, as former ownership had been signing leases at rates that are far below as-improved potential rents for the space. In addition, significant near term rollover coupled with landlord termination options will allow Brickman to vacate and re-tenant the property over the course of the anticipated hold period. Brickman has instituted an intensive capital improvement plan, which upon completion, will significantly improve the asset's curb appeal. Brickman anticipates attracting creative class tenancy to the property as Astoria continues to become a destination for artists, actors, artisans, as well as TAMI tenants due to its affordability and access to Manhattan. Many of these tenant groups are relocating from Manhattan due to escalating rental costs.
Brickman’s purchase price of $31.1 million ($266 per square foot) represents a favorable cost basis relative to recent office and industrial sales in Astoria and Long Island City.