2 Rivington Street Properties Adjacent to Allen Street Mall on the Auction Block for $11M+

Posted on: April 22nd, 2016 at 5:14 am by

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When Tristan Eaton painted a mural at 77 Rivington

The bones of a stalled Lower East Side hotel development are being picked apart piecemeal. DAB Group’s dream is done.

As part of the overall failure of the Allen Street Hotel on its backside, two adjacent properties on Rivington Street are similarly up for auction. A U.S. Bankruptcy Court judge is soliciting bids, via Eastern Consolidated, for the 8,261-square-foot 79 Rivington Street and the neighboring 847-square-foot vacant lot at 77 Rivington Street. Bidding starts at $11 million. Both were owned by DAB Group (aka Ben Zhavian), but later defaulted on the properties.

This is the second time in four years the two parcels have been up for grabs. Back in 2012, 77-79 Rivington were going for $7 million alongside the $28 million ask for the hotel site.

At one point, the corner lot was earmarked as the entrance to the Allen Street Hotel. Now, the vacant lot is being pitched as a single-story retail space that connects to 79 Rivington, the month-to-month home of Chabad Lower East Side.

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Early rendering of the Allen Street Hotel

The idea would be combine both of those [two stores] together,” Eastern Consolidated’s Jonathan Schwartz told the Observer. “For that there is demand amongst retailers, restaurants, a whole variety.”

79 Rivington Street is a five-story mixed-use tenement with 16 one-bedroom rental apartments. All are rent-stabilized and currently leased. Until two years ago, these apartments were covered under the J-51 tax abatement, a break for landlords who do capital improvements to a building.

As for the eyesore skeleton tower, it too is on the auction block, albeit separate from this transaction.

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