New York’s upstart investors find big profit
06.01.2013 | The Real Deal

New York’s upstart investors find big profit

East End Capital Partners
Founded: 2011
Principals: Jonathon Yormak and David Peretz

Jonathon Yormak, 41, and David Peretz, 34, both worked at Broadway Partners before the aggressive investment firm lost most of its holdings during the recession. In early 2011, the two went out on their own, launching Midtown-based East End Capital. East End has moved quickly since then, snapping up deals in Manhattan valued at $329.8 million.

In each transaction, East End has obtained equity from GreenOak Real Estate, a new Midtown-based investment fund. (Yormak said GreenOak has been a “fantastic partner,” but that theirs is not a formal partnership, and East End may do deals with or without GreenOak in the future.)

East End’s strategy, like many new investors, is to acquire under-performing assets and reposition them. For example, East End and GreenOak joined with another partner, Aby Rosen’s RFR Realty, in December to buy the 550,000-square foot Young & Rubicam building at 285 Madison Avenue. The partners, who paid $189 million for the building, expect to invest another $100 million in rehabilitations and upgrades, then re-lease it after the advertising agency leaves, Yormak said.

“We asset and property manage,” Yormak said. “We do everything, soup to nuts.”

That strategy worked out well at 256 West 38th Street, a half-empty Garment Center building that East End purchased for $30 million in 2011. After millions in renovations, the company landed women’s clothing retailer Caché for a 10-year lease deal in early 2012, bringing occupancy up to nearly 90 percent. East End sold the building late last year for $48.6 million.

Yormak said he expects the firm to buy $200 million worth of real estate in New York this year.