Rent-Stabilized Manhattan Building Sold at 97% Discount

A rent-stabilized East Harlem building sold for just $285K, a staggering 97% drop from its pre-2019 value, signaling severe market distress.

February 25, 2025

Nina Dale

A 29-unit East Harlem building sold for $285K (or $9,827 per unit), an eye-watering 97% drop from its 2016 sale price.
The building’s prior owner, Emerald Equity Group, lost control amid mounting debt and regulatory constraints.
Lender Mack Real Estate Credit Strategies offloaded the distressed asset, signaling a market desperate to shed risk.
The property had a history of financial and structural distress, including lawsuits and extensive code violations.

Key Takeaways

The recent sale of an East Harlem rent-stabilized building just set a new low for distressed sales in New York’s multifamily market, according to The Real Deal. Notably, the sale was not a voluntary one.

Behind The Fire Sale

The 29-unit property at 312 East 106th Street sold for just $285K earlier this month—a shocking 97% discount from the $8.8M price paid by Emerald Equity Group in 2016. The seller, Mack Real Estate Credit Strategies (MREC), had taken over from Emerald Equity after a loan default.

The deal, at $9,827 per unit, is far below the $110,694 per-unit average for similar rent-stabilized properties in 2024, per Ariel Property Advisors.

The distressed nature of the deal underscores the severe devaluation of rent-regulated buildings since New York’s 2019 Housing Stability and Tenant Protection Act, which restricted landlords’ ability to raise rents and deregulate units.

Investor Fallout

312 East 106th was part of a 47-building portfolio Emerald Equity acquired in 2016 for $357.5M, backed by a $189M loan from Sabal Capital Partners.

However, when the 2019 law eliminated deregulation strategies, the firm’s investment thesis collapsed. MREC took control of many of Emerald’s properties by early 2023, but even with new management, multiple foreclosure filings followed.

The building itself had also fallen into severe disrepair. By 2022, NYC had sued over unpaid relocation costs for displaced tenants, while the Department of Buildings reported extensive structural damage.

The property currently carries 114 open violations, most categorized as hazardous.

The Bigger Picture

The sale highlights the freefall in New York’s rent-stabilized market, where even distressed investors are struggling to find a floor.

With some stabilized properties now trading below $10K per unit, market participants are bracing for further declines. As one industry expert noted, “The bottom is dropping out.”