New York New Home Field for Frank McCourt?

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As he waits to see if his parking lot around Dodger Stadium will ever become a grand commercial development, Frank McCourt has turned his attention to the East Coast.

McCourt Partners, a venture of his Beverly Hills investment firm McCourt Global, announced that it had made its first significant purchase in New York for what it expects will be its largest-ever real estate development.

McCourt Partners paid more than $167 million for the vacant industrial land on Manhattan’s West Side last month and plans to develop a 730,000-square-foot mixed-use office, residential and retail tower.

News of the acquisition comes less than 10 months after Frank McCourt bought a home in the Big Apple and, shortly thereafter, opened an office nearby for his company to scout real estate investments.

In a statement announcing the purchase, McCourt, chairman and chief executive of McCourt Global, said he was “tremendously excited” to enter the market.

“We are very optimistic about the long-term opportunities in the New York City real estate market, and we believe the value of this area in particular will increase substantially over the next decade,” the statement said. “We look forward to developing an important new building that will tap into the vibrant artistic and creative community of this neighborhood.”

The property, on 10th Avenue between 30th and 31st streets in Chelsea, borders a $15 billion project called Hudson Yards, which, with plans for 16 high-rises totaling more than 13 million square feet of office, residential, hotel and retail space along the Hudson River, is among the largest real estate projects in U.S. history.

Even with McCourt’s attention on New York – he reportedly paid $50 million for a 5,000-square-foot, six-bedroom condo on Fifth Avenue in December and in January opened a midtown Manhattan office – sources close to McCourt said he is still committed to Los Angeles.

McCourt Global – formerly called McCourt Group – still maintains its headquarters on Wilshire Boulevard in Beverly Hills and, in addition to his stake in the Chavez Ravine property, he owns operating rights to the Asics LA Marathon.

The New York development project, one source said, is simply an effort to diversify his company’s portfolio.

Still, it’s not clear whether he considers Los Angeles home any longer.

City Ethics Commission filings show that McCourt, using a Beverly Hills address, in June donated $1,000 to then-Mayor Antonio Villaraigosa’s officeholder account. Last week, however, McCourt and Georgetown University, his alma mater, announced that he had pledged to give $100 million to endow a school of public policy, to be named in his honor. In its report on the gift, the Washington Post called McCourt a New York resident. Earlier this year, a McCourt spokesman told the Business Journal that he had purchased a home in Florida and made it his primary residence. (Florida has no state income tax.)

Asked last week to clarify where McCourt considers home, his spokesman had no comment.

Big moves

McCourt, 60, was born and raised in Boston to a family with deep roots in real estate. He moved to Los Angeles in 2004, the same year he acquired the Los Angeles Dodgers from Fox Entertainment Group Inc. for $430 million.

Widely reviled by local sports fans for driving the baseball franchise into bankruptcy in 2011, McCourt saw the team make it to the playoffs four times under his ownership. He at one time had at least four homes in Los Angeles. He ceded all of them – two in Holmby Hills and two in Malibu – to ex-wife Jamie McCourt during a highly publicized divorce.

He sold the Dodgers last year to Guggenheim Baseball Management, a venture including former L.A. Laker Earvin “Magic” Johnson, for about $2 billion. McCourt retains a 50 percent ownership interest in Dodger Stadium’s 260-acre parking lot, which is widely believed to hold potential for development.

McCourt’s highly leveraged purchase of the Dodgers was seen, at the time, as a bold play. The New York acquisition is no less dramatic.

The $167 million paid by McCourt Partners is nearly four times the $43.5 million Sherwood Equities Inc. of New York and Long Wharf Real Estate Partners of Boston paid for the 26,000-square-foot parcel just two years ago. The off-market deal with McCourt Partners closed Aug. 30.

Jeffrey Katz, president and chief executive of Sherwood, said his investment firm sold the property because the rate of return was irresistible.

“We began investing in this area over 25 years ago and it is finally now in the moment where it is all coming together at a scale that has never been imagined, even in the city of New York,” Katz said in a statement.

In addition to abutting the Hudson Yards development, the property also sits near the High Line, a public park being built on a 1.5-mile stretch of an abandoned elevated railroad line. Two sections of the park have opened in recent years, and a third and final stage is expected to open near McCourt Partners’ newly acquired property next year.

Zoning for the Chelsea site allows for mixed-use development of a 296,000-square-foot building for both commercial and residential use. According to Sherwood’s announcement of the sale, McCourt Partners will have the opportunity to pay the city for the right to build an additional 436,000 square feet – for a total development of nearly 733,000 square feet – as long as 494,000 square feet is devoted to commercial use. The remaining 239,000 square feet may be residential. Specific design and construction details for the project are yet undetermined while the company searches for an architect to spearhead the development.

At those numbers, McCourt’s acquisition costs just for the land figure out to almost $6,500 a square foot and more than $227 a square foot for the finished space. That’s well in excess of anything in Los Angeles.

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