Extell Development has found a partner that will infuse $1.2B into its ample development pipeline.
An undisclosed hedge fund has become a preferred equity partner in nine properties owned by Gary Barnett and his firm, according to filings with the Tel Aviv Stock Exchange.
A rendering of The Torch at 740 Eighth Ave.
Barnett famously spends years assembling lots, patiently waiting out potential sellers and hold-out tenants. The fruits of those efforts have recently ripened at numerous assemblages, allowing the developer to move forward with a variety of developments. The new capital will be pivotal in financing his ability to do so.
It’s unclear how much of the funding will go into each project, though the cost of development is expected to total billions of dollars.
Barnett will use the funds to expand his portfolio of lavish supertalls and other luxury projects. He is most known as one of the founders of Billionaires’ Row, having built the Central Park Tower and One57. The new projects are scattered across Manhattan, reaching into Brooklyn. One is in Utah.
Several of the projects listed in the TASE documents — which were obtained by Bisnow and translated using Google — are still in the early stages of development, with little previously publicly revealed by the notoriously tight-lipped company.
Though Extell is not public in the U.S., it is one of a number of real estate firms that raise money from bondholders on the Israeli stock exchange. That process requires a number of public disclosures.
Barnett and representatives for Extell did not respond to multiple Bisnow requests for comment.
Bisnow/Sasha Jones
Gary Barnett at Bisnow’s New York Healthcare Real Estate Conference
Disney Campus
Among the large revelations in the documents is that Barnett is planning a 1.8M SF mixed-use residential project for the former Walt Disney Co. campus.
Extell spent $921M in early 2022 on a package of parcels that were home to the former broadcasting facilities for ABC and Disney. The properties, including 77 W. 66th St., span 1.7M SF, the Commercial Observer reported at the time, giving the developer the leeway to build big — and Barnett is seemingly doing just that.
Local advocacy group Landmark West has criticized Extell’s involvement at the site. In June, the group released renderings showing that, as-of-right, the developer could build up to 90 stories, or 1,200 feet, creating a structure that would tower over the rest of the Upper West Side.
Wellington Hotel
Extell filed plans early this year to demolish the now-shuttered Wellington Hotel at 871 Seventh Ave.
The developer originally proposed a 336K SF hotel before expanding to a 457K SF high-rise with hotel and residential. However, its latest application, filed with the New York City Department of Buildings in January, received objections, meaning that Extell would have to resubmit plans before starting construction.
The TASE filings show that Extell is now considering a 600K SF hotel, residential and retail development at the site.
350 E. 86th St., the former site of a Gristedes
350 E. 86th St.
The equity could reinvigorate Extell’s project at 350 E. 86th St., which has been hindered by hold-out landlords and tenants.
Extell spent years collecting the lots surrounding the former Gristedes supermarket, which he purchased for $92M in 2016, but it wasn’t until 2022 that he was able to move forward with construction.
That year, the firm won a lawsuit against a rent-stabilized tenant who refused to move out of the building on the corner of East 86th Street and First Avenue. The stubborn tenant first caused the developer to file plans for a 22-story tower that would wrap around the walk-up.
The Gristedes is long gone, having been demolished and replaced with scaffolding, according to Google Maps imagery. A 600K SF mixed-use building with residential and retail is planned, according to the TASE filings.
231 W. 96th St.
The document also reveals Extell’s involvement with ABS Partners Real Estate’s 231 W. 96th St., which has an alternative address of 2560 Broadway.
Last year, Crain’s New York reported that ABS filed plans to demolish the rent-stabilized corner building. ABS is still involved at the site, according to the latest property records, but Extell is identified as an owner in an August DOB filing, seeking an alteration to the property’s sidewalk.
A 800K SF development with rental and condo units, along with retail space, is planned for the site, according to the TASE filings.
A representative for ABS did not respond to Bisnow’s request for comment.
Downtown Brooklyn’s Fulton Street
Extell signed an $85.9M ground lease in 2022 to take over 356 Fulton St. from The Feil Organization, creating a partnership between the two developers for a Downtown Brooklyn skyscraper.
The developers have continued to expand their control on the block between Red Hook Lane and Smith Street. They now own at least eight parcels on Fulton Street. The two spent $7.7M in July to transfer additional development rights to the project, according to public records.
Feil originally proposed a 43-story, 475K SF building for the site. The development would have had 421 apartments, 30% of which would have been set aside as affordable under the now-expired 421a program. Now, according to the TASE filings, that project may expand to 600K SF.
576 Fifth Ave.
It took Barnett a decade to piece together an assemblage that spans the entire block of Fifth Avenue between West 46th and 47th streets. In March, he secured the final piece of the puzzle with 576 Fifth Ave.
Extell now plans to build a 33-story, 1.1M SF commercial tower with offices and Manhattan’s first Ikea. Demolition permits were filed for the site in April, according to the DOB.
The project is expected to cost over $1B, the New York Post previously reported. As part of the deal, the international furniture retailer is investing approximately $292M of ordinary and preferred capital, according to the TASE documents.
Via NYC Zoning Application Portal
Renderings of Extell Development’s proposed developments for 655 Madison Ave.
655 Madison Ave.
Since acquiring 655 Madison Ave. for $160M a year ago, Extell has been charging ahead with the construction of a mixed-use tower.
Originally, a 37-story building was pitched for the site. In July, that proposal was supersized to a 765K SF, 74-story skyscraper with 154 condos, 163K SF of office and 70K SF of retail, according to documents filed with the Department of City Planning.
That’s only if Barnett receives the proper zoning approval. As of right, the developer can build an 84-story supertall with a total of approximately 600K SF.
Extell has reached a sales agreement with a fashion and cosmetics company for the commercial space in the planned tower, according to the TASE filings, which appear to confirm reports that Chanel is in talks to buy the retail space for around $450M.
The Torch
Barnett’s Theater District hotel project at 740 Eighth Ave. is among his most extravagant. Dubbed “The Torch,” the 875K SF development is planned to have an 825-key hotel, retail, an observation deck and a 260-foot drop tower ride.
In March, Bisnow first reported that the firm lined up $1.3B of financing for the development as well as signed a letter of intent with an unnamed hotel chain. The new hedge fund infusion could further propel the project forward.
Deer Valley East Village
Outside of New York, the hedge fund is getting involved in Extell’s redevelopment of a luxury Utah resort called Deer Valley East Village.
The investment doubles the previous size of the skiable terrain to over 5,700 acres and introduces a series of major enhancements.
In July, Extell announced that it closed a $600M construction loan for the Four Seasons Resort and Residences, the first new luxury alpine village to be developed in North America in more than 40 years. Construction of the project began earlier this spring, with completion expected in 2028.
Other portions of the projects have already been completed. The 436-key Grand Hyatt Deer Valley opened in November as an anchor of the redevelopment, Hotel Dive reported.