Jan. 4, 2013 - The Real Deal

Midtown-based Rockrose Development plans to develop an approximately 700-unit rental building at the former Eagle Electric building in Long Island City. It is the firm’s third major rental project launched in the neighborhood’s Court Square section since 2007. Combined, the three buildings will have nearly 2,400 units when completed.

The development firm paid an affiliate of the Brooklyn-based Kraupner Group $48 million for 43-22 Queens Street, a 320,000-square-foot industrial building that was one of at least a half dozen large properties once owned by the Eagle Electric Manufacturing company, city records show. The Real Deal reported the sale last week but at the time the identity of the buyer was shielded behind a limited liability company. The deal went into contract in September and closed on Dec. 14, the documents show.

Rockrose plans to demolish a portion of the six-story building, located between Queens and Dutch Kills streets, and the Sunnyside rail yards. On the existing building’s current footprint, Rockrose also plans to construct a modern tower of up to 30 stories using the 200,000 square feet of additional air rights.

For tax reasons, more than 50 percent of the project, which has development rights of 520,000 square feet, needs to be new construction, Justin Elghanayan, Rockrose’s president, said. “There are a lot of interesting architectural possibilities of combining the old with the new, which is very much in the spirit of Long Island City,” Elghanayan said. He added, “It is very rare to have a rental loft building,” because most are converted to condominiums.

In Court Square, Rockrose is nearing completion of Linc LIC, a 709-unit rental tower at 43-10 Crescent Street, and is in the planning phases for a larger tower a block away at 43-25 Hunter Street that will have about 975 units.

Elghanayan declined to comment on whether the firm is seeking to purchase properties fronting Jackson Avenue, the closest major street for the site. Typically, developers want to front on the closest major street, but at the same time existing property owners are aware of that, and it often drives up prices, insiders said, sometimes unreasonably high.

The building now fronts on Queens and Dutch Kills streets and overlooks the Sunnyside rail yards. There are five low-rise properties fronting on Jackson Avenue and three others between those properties and the Rockrose site.

Elghanayan said the rents for the Eagle building have not been finalized, but he expected them to be in the range of his firm’s other buildings, about $1,800 for a studio, $2,600 for a one-bedroom and $3,400 for a two-bedroom.

CBRE Group Senior Vice President John Reinertsen represented the sellers.

Rockrose also owns another parcel between their Court Square projects that has a garage structure at 43-15 Crescent Street and a parking lot. The development firm signed a 10-year deal with the foodie-favorite restaurant M. Wells at the garage.