Breaking Ground Pays $172M For Upper East Side Dorm-Turned-Migrant Shelter
Breaking Ground has acquired a former Upper East Side dorm that has been used as a migrant shelter.
The supportive housing nonprofit purchased 1760 Third Ave. for $172M, according to property records filed Monday. A total of $163M in financing was primarily provided by city and state agencies.
That includes a $128M mortgage from the New York City Department of Housing Preservation and Development, $29.5M from the New York City Acquisition Fund, plus $6M from the New York State Homeless Housing and Assistance Corp., according to documents filed with the city.
As part of the deal, Breaking Ground agreed to continue to operate 1760 Third as a migrant shelter through November, after which it plans to pursue a low-income housing redevelopment, a Breaking Ground spokesperson told Bisnow Monday.
The 263K SF building had housed students from the City University of New York and other local colleges, but last year it was converted to house 500 migrant families, the New York Post reported.
Originally, Breaking Ground secured a deal to acquire the building before the migrant crisis, the spokesperson said, but the previous owner struck a shelter deal with NYC Health + Hospitals, postponing the acquisition until last month.
“Addressing our housing and homelessness crisis in New York City requires bold action,” a Breaking Ground spokesperson said in a statement. “We are grateful to work with our partners at New York City and New York State to acquire and convert the underutilized residential building.”
The nonprofit plans to dedicate 261 of 435 units as housing for formerly homeless individuals, while the rest will be leased to low-income households making up to 60% of the area median income, according to Breaking Ground.
Breaking Ground's mortgage from the HPD matures in 2064. Construction financing to reposition the building is expected to be provided by New York State Homes and Community Renewal and other state sources. A construction closing is expected at the end of this year, Breaking Ground's spokesperson said.
A partnership of 60 Guilders and RCG Longview bought the building in 2019 from the Chetrit Group, The Real Deal reported at the time. The partners paid $212.5M, working out to more than $800 per SF for the 263K SF property.
The seller of the building in the most recent deed filing is listed as an LLC registered to a 109Co, an affiliate of 620 Mgmt, which has been tied to 60 Guilders at other properties.
The deed was signed on the seller's side by executives from CenterSquare Investment Management, the successor to RCG Longview, and Principal Real Estate Investors.
A spokesperson for the mayor's office didn't respond to Bisnow’s request for comment.
The city has similarly invested in other properties to serve as homeless shelters. Last year, Mayor Eric Adams' administration paid $220M to state-run Pakistan International Airlines Corp. to lease the more than 1,000 rooms in the Roosevelt Hotel.
In total, the city has taken roughly 16,000 hotel rooms off the market to serve as shelters for the ongoing migrant crisis. However, that has raised concerns over the future of those properties, including the cost of potential renovations to rehabilitate buildings used as shelters.
Breaking Ground, a 34-year-old nonprofit supported by prominent local developers, is a frequent partner with the city on affordable housing projects and programs to support unhoused New Yorkers.
Also on Monday, a partnership of Breaking Ground, Douglaston Development and Asland Capital Partners announced that it closed on a $275M deal with the New York City Housing Authority to renovate and convert the Sack Wern Houses in the Bronx to Section 8 housing.
