New York marina sold for $3.5 million – SuperyachtNews

ONE°15 Brooklyn Marina has been sold to private investment firm Radcliff Management for $3.5 million following its bankruptcy filing earlier this year. Speaking with SuperyachtNews, Joshua Olshin, Managing Partner at Auction Advisors, the firm that oversaw the sale, describes the new owners as highly experienced investors in the marina sector, successfully outbidding considerable competition to secure the property.

“Of the 36 registered parties, about 75% were established marina operators with multiple properties,” he explains. “These were serious buyers, many owning marinas in the southern US or the Northeast. While some recognised the property’s value, they chose not to bid due to financial history or other factors. So, it was a tough sell at the end of the day. But, the auction result exceeded the baseline by more than 50%, which is a great outcome.”

ONE°15 Brooklyn Marina filed for Chapter 11 bankruptcy protection on 26 September, along with associated entities such as ONE Edge Marina Finance Company, ONE°15 Restaurant (operating as Estuary), and ONE°15 Brooklyn Sail Club.  Located at Pier 5 in Brooklyn Bridge Park, New York City and spanning 7.5 acres, the marina features over 100 berths and the ability to accommodate vessels up to 91 metres.

The previous owners invested heavily in the business too. According to Olshin, around $15 million was pumped into the marina’s infrastructure in recent years. Despite this, the company struggled financially, which likely influenced buyer sentiment.

Before the property auction, Radcliff placed a “stalking horse”, which is commonplace in bankruptcy cases. Essentially, it’s an initial offer that may not be ideal but is acceptable to the seller. It sets a baseline for the auction and allows higher offers to be made during the process while offering a safety net.

“In this case, the stalking horse bid was agreed upon before the auction date,” explains Olshin. “To proceed, we needed outside parties to bid at least $50,000 above that baseline. That’s the increment we required to make the auction competitive.”

In addition to the stalking horse bid from Radcliff Management, Auction Advisors received a $2,181,900 competing bid from SMI Properties Group, which was the only other qualified bid before the pre-qualification deadline. Based on a pre-auction offer of $2,181,900 from SMI, Radcliff opened the bidding at $2,231,900. In the end, Radcliff bid $3,500,000 before SMI backed down, with its last offer of $3,450,000 serving as the backup bid.

The property is operated under a 17-year lease, which is substantial but not perpetual and doesn’t include land ownership. The marina also has sizeable upkeep costs and other lease agreements, such as the one with the restaurant.

In terms of the financials, the sale proceeds will primarily go to creditors. “They are expected to achieve a decent recovery, which is better than the typical pennies on the dollar seen in bankruptcy cases,” says Olshin. “However, equity holders, the investors, are unlikely to see any return. Even though the final price was strong, it just about covers debts and obligations, including payments to the landlord.”

The buyer of ONE°15 Brooklyn Marina is acquiring the businesses and operational rights associated with the marina but not the land on which it is located. Under a lease agreement, the new owner purchases the operational assets, not the property itself.

This includes the marina’s infrastructure, such as floating docks, berths and other facilities, as well as the business operations and associated assets. The buyer also assumes control over tenant agreements, including the lease with the on-site restaurant and will also take on certain liabilities and obligations as outlined in the stalking horse bid and auction terms.

The land itself remains under the ownership of the landlord, with the new owner continuing to operate the marina under the terms of the existing lease. This arrangement is typical in high-value urban areas like Brooklyn, where municipalities, trusts, or private entities often retain land ownership.

So, while the marina’s location and infrastructure might make it a valuable acquisition in some ways, the lease condition imposes certain limitations. The buyer will not have permanent control over the property and will need to negotiate lease terms with the landlord in the future, which might explain why some potential bidders opted not to participate in the auction despite recognising the marina’s prospective value.

The $3.5 million sale price is a solid outcome given the circumstances. It’s considerably higher than the stalking horse bid, but the historical challenges associated with the property have deterred greater interest from some of the larger marina operators. Overall, it’s a good result, considering the context. 

“In many ways, One15 Brooklyn Marina is a trophy property, but it has had its share of challenges. The new owner has diligenced the property very thoroughly and, with a new model, can hopefully make it a financial success,” concludes Olshin.

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