Gamma Real Estate closes on $86M purchase of 3 Sutton Place, taps Thomas Juul-Hansen for new design
The original rendering of 3 Sutton Place by Foster + Partners
Following a contentious legal battle, Gamma Real Estate has won the foreclosure auction and closed on the $86 million acquisition of 3 Sutton Place, a development site where the firm plans on building a 700-foot-tall condominium tower. As Commercial Observer learned, this includes three neighboring lots at 428-432 East 58th Street between First Avenue and Sutton Place. Earlier this year, 6sqft explained that a bankruptcy judge authorized the sale of the property after Joseph Beninati’s Bauhouse Group failed to pay back creditors. While Stephen B Jacobs remains the executive architect, Gamma has hired Thomas Juul-Hansen, a Danish-born architect, who will design the skyscraper.
In 2015, Bauhouse Group purchased the Sutton Place properties for $32.3 million and then spent another $33 million to secure air rights and easements for their planned 68-story condo. Bauhouse Group hoped to build a 1,000-foot-tall skyscraper designed by Norman Foster, although its soaring height caused a backlash among residents of the Midtown East neighborhood. Unable to finance construction, the firm defaulted on $147 million in loans to Gamma in January of 2016 and filed bankruptcy.
After their purchase, Gamma has already demolished three tenement buildings on East 58th Street to make room for their 67-story tower with 389 units. The firm’s design calls for amenity spaces on the first five floors with two units per floor above.
“We plan to add to the architecture and rich legacy of Sutton,” CEO of Gamma Real Estate, Richard Kalikow, told Commercial Observer. “Our plan, different from the prior owner’s, will certainly conform to the Sutton look and feel. The entire look and feel of the building, we want it to be contextual to the neighborhood. We don’t think the previous developer cared about whether it was contextual; he just wanted to build something eye-catching.”