David Lichtenstein’s The Lightstone Group just made a cool $171 Million from the sale of a downtown Manhattan development site.
The buyer of the properties was San Francisco-based Carmel Partners which is led by CEO Ron Zell. Lightstone acquired the development site back in 2012 for only $63 million. The sale includes air rights above four vacant lots.
Will you offer us a hand? Every gift, regardless of size, fuels our future.
Your critical contribution enables us to maintain our independence from shareholders or wealthy owners, allowing us to keep up reporting without bias. It means we can continue to make Jewish Business News available to everyone.
You can support us for as little as $1 via PayPal at [email protected].
Thank you.
Lightstone had hoped to construct a 48-story, 463-apartment residential tower there, but the plans fell through. So poor Lightstone will have to make do with a lousy $108 million — more than 175% — profit on the site after only two years of ownership.
Now Carmel will try and build the new tower there.
The properties include 112, 114, 116 and 118 Fulton Street on the corner of Dutch Street. The Parcel formerly included 120 Fulton Street.
Lightstone Chief Executive David Lichtenstein. Told Crain’s about the deal, “They came to us, asked if we would sell it, and they gave a very attractive number.”
In other Lightstone news, in an interview with the Washington Post David Lichtenstein explained why he bought land instead of homes during the housing bust.
“I started my career buying and owning single-family houses, and I know that’s a really tough job. Toilets break. Trees fall. There are so many things that can go wrong. Land, on the other hand, is cheap to manage. It’s painless, really. All you have to do is pay your taxes, and that’s it, ” he said.
“We saw areas in the country where the chasm in pricing between homes and land was greater than it should have been. Home prices were down 50 percent in some areas, but land was down 90 to 95 percent. When the housing market recovers fully, the land will be the better investment. Think of it this way: Let’s assume a house was once worth $1, and then it fell in value to 50 cents. When the market bounces back, the investor who bought that house at the 50-cent low will see their investment double. The investor who bought the land at 5 cents will see their return multiply 20 times.”
Lichtenstein further stated that he thinks that land values in the US will have fully recovered within the next five years.
