A&E Real Estate Eyes $200M for Upper West Side Apartments

One of the city’s biggest multifamily owners is looking at taking a loss on a large apartment complex it picked up during its 2010s buying spree.

Douglas Eisenberg’s A&E Real Estate put the 413-unit Holland complex on the Upper West Side up for sale, The Real Deal has learned.

The multifamily landlord is eyeing a price around $200 million, roughly a third less than the $287 million the company paid seven years ago.

It’s one of the latest — and one of the largest — deals to show the impact the 2019 rent laws have had on rent-regulated apartment buildings.

A&E purchased the complex from Ofer Yardeni’s Stonehenge Partners in the spring of 2018, a little more than a year before city lawmakers passed the Housing Stability & Tenant Protection Act of 2019. The law significantly limited the amount by which landlords could raise rents on regulated apartments, and has had a severe impact on building values.

A representative for A&E declined to comment.

A Newmark team led by Adam Spies and Doug Harmon is marketing the complex at 120-160 West 97th Street and 135 West 96th Street, named the Holland, for sale.

The group of buildings is 94 percent leased, according to an offering memo. Nearly 60 percent of the apartments (243 units) are rent stabilized, and of those 213 have preferential rents averaging 93 percent below the legal rents, according to the memo.

Preferential rents are a lawful, but controversial, method owners use to increase the rents they collect on an apartment. Owners agree to charge tenants a rent that is lower than the legal rent they can lease an apartment for. Upon vacancy, they can raise the charge to the legal rent.

The preferential rents at the Holland represent $3.3 million in potential upside, according to the offering memo. It also notes that the property’s lender is willing to consider supplying financing for a sale.

Eisenberg founded A&E with John Arrillaga Jr in 2011, and quickly amassed one of the city’s largest multifamily portfolios totaling thousands of units by buying large apartment complexes.

The company is currently facing foreclosure on a 3,500-unit spread across Harlem, Queens, Brooklyn and the Bronx. An A&E spokesperson told TRD in February that the company was in negotiations with its lenders and planned to resolve the issue within 45 days.