Northwell Health is snapping up a long-vacant shopping center in Rego Park for $235.5 million, a deal that could pave the way for a major healthcare conversion.
The hospital giant purchased the 338,000-square-foot Rego Park I retail complex from Alexander’s, the real estate investment trust controlled by Vornado Realty Trust chief executive officer Steven Roth, according to the Commercial Observer. The deal breaks down to $697 per square foot.
The sale is expected to close in the third quarter.
The three-story property at 96-05 Queens Boulevard sits on six acres at the busy intersection of Queens Boulevard and Junction Boulevard, near the Long Island Expressway. Built in 1959, the site includes a 1,236-space parking garage and long housed discount retailers including Burlington and Marshalls before going dark.
Alexander’s spent the past year clearing the complex, relocating tenants and employees to the nearby Rego Park II shopping center, a 605,000-square-foot open-air retail complex the REIT also owns. The newly empty site gives Northwell a blank slate in one of the borough’s busiest commercial corridors.
The transaction is expected to generate roughly $202 million in proceeds for Alexander’s and produce a $145 million after-tax gain, according to a company release. The REIT will collect about $48 million from operations tied to the property last year and another $97 million this year.
The sale closes a roughly 30-year chapter for Roth, who gained control of Alexander’s in the mid-1990s after a high-profile ownership fight with Donald Trump.
Trump owned about 27 percent of the company while Roth held roughly 29 percent. Trump’s stake was ultimately seized by lenders and sold to Roth in 1995 after he defaulted on loans tied to his hotel and casino properties, Crain’s reported.
What Northwell plans to do with the property remains unclear, though the scale and location suggest a potential medical campus, outpatient hub or mixed-use health care redevelopment. The health system is the largest private employer in New York with more than 104,000 employees and roughly 900 outpatient facilities across New York and Connecticut.
In a statement, Northwell called the acquisition a “strategic investment,” adding it intends to explore ways the site could expand access to healthcare in Queens.
— Holden Walter-Warner
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