Real estate colleagues questioned Justin Palmer’s purchase of a boarded-up, eight-story San Francisco office building for $17.7 million, almost double the price paid for it six years before. Then he told them his plan.
Palmer, co-founder of New York-based builder Synapse Capital, is redeveloping the property into a Yotel, a minimalist hotel brand whose signature feature is tiny rooms, or “cabins,” of about 175 square feet (16 square meters). That means Synapse can fit 202 revenue-producing rooms into a building that would accommodate just 94 were it a standard hotel, he said.
“People in the industry in San Francisco thought we were crazy until they figured out that we were fitting in two times the amount of keys,” said Palmer, who bought the property with Yotel’s largest shareholder in April and expects to open the hotel in 2017.
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A partnership between Synapse Capital and Pan Brothers Associates has closed on a Williamsburg development site, Synapse announced yesterday. The two New York-based firms are slated to build a 65,000-square-foot mixed-use property on the parcel that will include a 100-room hotel, a 10-unit residential building and ground-floor retail space.
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SYNAPSE RESIDENTIAL GROUP AND TAURUS INVESTMENT HOLDINGS
ACQUIRE 532 WEST 152nd STREET
NEW YORK — (January 8, 2013) — Synapse Residential Group LLC, an affiliate of Synapse Capital (www.synapsecap.com),
and its joint venture partner, an affiliate of Taurus Investment Holdings, LLC, have acquired 532 West 152nd Street between
Broadway and Amsterdam Avenue in West Harlem. The Property is a 14,000 square foot, six-story walk-up building with 20 twoand
three-bedroom residential units. The acquisition marked the third New York City acquisition for the Synapse-Taurus
partnership in the last seven months, and is a continuation of the investment strategy that commenced in mid-2013.
Justin Palmer, Partner at Synapse Capital, stated, “As we pursue our investment strategy in Harlem, we continue to find undermanaged
assets that allow us to create value through repositioning the properties. This is a great building with 17 free market units,
which allows the partnership to take advantage of the substantial changes happening in the Hamilton Heights neighborhood.”
Peter Merrigan, Chief Executive Officer of Taurus Investment Holdings, stated that, “As with our other recent Harlem
investments, we expect this property will benefit from the combination of high barriers to entry and continued upward pressure on
rental rates in Harlem and look forward to working with Synapse on this and future opportunities.”
Synapse has already set to work on the cost-reducing retrofits to create a more environmentally efficient building, which include
building envelope improvements, replacement of the roof, installation of low flow water fixtures, piping and roof insulation, as
well as upgrades to common areas. The firm envisions the property competing very well for the young professional and student
populations due to its proximity to subway lines and Columbia University.
Al Picallo, Managing Partner at Synapse Capital, added, “This property will benefit from our strategy to improve operating
efficiencies through sustainable energy-saving programs, and allows our partnership to increase our footprint in the area. We look
forward to improving the property’s value for our investors and enhancing the environment for our tenants.”
About Synapse Capital and Synapse Residential Group:
Synapse Capital is an integrated real estate company that provides advisory, acquisition, development and operational expertise
to its clients and investors. Synapse Residential Group invests primarily in rent-regulated residential real estate assets with a
focus on creating value-add returns through energy efficient retrofits that significantly reduce operating expenses. The principals
of SRG have extensive experience in the Harlem rent regulated housing market having foreclosed, managed and repositioned over
1,000 residential units and 15,000 SF of commercial property. In addition, the principals of SRG have extensive experience
retrofitting pre-war buildings and have achieved energy savings on existing projects beyond industry standards.
About Taurus Investment Holdings:
Taurus was founded in 1976 and has evolved into a global owner-operator and value-add developer of both directly managed and
joint venture assets with offices throughout the US, Canada, Argentina, Turkey, UK and Germany. Taurus has purchased and sold
more than 20 million square feet of residential, office, industrial, retail, hotel and other commercial real estate assets since its
inception. Presently the firm has a portfolio that is valued at more than $2 billion.