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Rechler, Qataris join Orbach and Gotlib’s $850M apartment deal

Investors provided $261M toward purchase of Solow multifamily buildings

From left: QIA's Mansoor Bin Ebrahim Al-Mahmoud, Scott Rechler, and Meyer Orbach with One Sutton Place North
From left: QIA's Mansoor Bin Ebrahim Al-Mahmoud, Scott Rechler, and Meyer Orbach with One Sutton Place North (Getty, QIA, Orbach Housing)

Scott Rechler’s RXR and Qatar’s sovereign wealth fund joined Meyer Orbach and Josh Gotlib on their $850 million purchase of three apartment buildings developed by the late Sheldon Solow.

RXR, the Qatar Investment Authority and Macquarie Capital Principal Finance provided a $261 million preferred equity investment on the deal, the partners announced Wednesday.

RXR’s Russell Young, vice president of the company’s investment management arm, said his team was able to pull the deal together on “an accelerated timeline” at a time when financing has become a challenge.

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GO Partners — a joint venture between Orbach’s Orbach Affordable Housing Solutions and Gotlib’s Black Spruce Management — closed last month on their purchase of the three buildings: One Sutton Place North, Two Sutton Place North and One East River Place.

The properties contain 850 units and are part of a larger, 1,766-unit portfolio that Orbach and Gotlib are buying from the Solow Building Company for $1.75 billion.

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The buyers have already closed on the $390 million purchase of the 408-unit 685 First Avenue for about $390 million, leaving another two buildings worth roughly $560 million to finalize. Property records recorded Wednesday show Black Spruce paid Solow Realty $410 million for a commercial property at 523 East 72nd Street and an apartment building at 530 East 73rd Street.

Rechler’s RXR, which owns a large portfolio of Midtown office properties, has been busy in recent years developing and investing in multifamily properties, some of which it is looking to sell.

The company in October put its interests in five multifamily properties in New York and Connecticut up for sale.

Earlier this year RXR closed on its $220 million purchase of the rental portion of CIM Group and LIVWRK’s 85 Jay Street luxury development in Dumbo.

Qatar has been one of the more active foreign investors in New York City real estate in recent years. The QIA in 2015 purchased a 44 percent stake in Brookfield Property Partners’ Manhattan West megadevelopment. The partners sold a 49 percent stake in One Manhattan West to Blackstone Group earlier this year at a $2.9 billion valuation.

QIA in 2016 bought a $622 million minority stake in Empire State Realty Trust and in 2019 bought the St. Regis Hotel from Marriott International for $310 million.

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Black Spruce ManagementInvestment SalesOrbach GroupRXR RealtyScott RechlerSheldon Solow