Not Every Address that Glitters is Gold: Benenson Capital Tries for 150% Return at 591 Park Avenue

Second Avenue style, Park Avenue prices.

Second Avenue style, Park Avenue prices.

Park Avenue is a rough place to be for a townhouse. The stretch was originally shunned by New York’s moneyed elite, back when the New York Central’s steam-belching railroad ran through an open-cut on the Upper East Side, and when it was finally covered, the pressure to develop was so intense that builders threw up large apartment houses, not stately townhouses.

And what townhouses do remain have a hard time capturing the avenue’s luxury reputation. Too wide and busy of a street for a single-family house and too small of one to make for a good high-end office location: it’s hard to know what to do with one of them. (Unless you happen to be a developer like Toll Brothers and can get your hands on two or more contiguous townhouses on a non-landmarked block.)

To these problems, 591 Park Avenue adds a few more wrinkles: an undistinguished, unornamented brick façade and an awkward location, wedged in between two churches. And while the Presbyterians to the north might not pose much of a problem, the Christian Scientists to the south have turned the structure (the neo-Georgian Third Church of Christ, Scientist) into a virtual catering hall.

All of which bodes poorly for the owners’ $21.8 million asking price—which, if the townhouse achieved anywhere near that amount, would make it one of the most impressive flips in Upper East Side townhouse history.

Almost $22 million down, a few million more for the renovation and this could be yours!

$21.8 million down, a few million more for the renovation and this could be yours!

Benenson Capital, the current owner of the building, picked it up three years ago for just $8.8 million. “They’re sort of bottom-feeders,” said one broker. “They try to pick up cheap stuff, and here they found something in distress.”

But with only 8,000 square feet of space—plus another 3,000 that you’ll have to beg and cajole the Landmarks Preservation Commission to access—the building may not be so well suited to the “small luxury corporate headquarters, embassy, spa, medical offices, small high end condo or rental development” uses that its brokers—Gail Bomze, Estelle Meister and Steven Cid at Douglas Elliman—advertise.  (Ms. Bomze said she couldn’t comment, but did tell us that the property has not been renovated.)

“Ever since 21 Beekman sold for so much money”—$35 million— “everyone thinks theirs is worth a ton,” one Upper East Side townhouse broker told The Observer. “Someone might like [591 Park], but for $21 million? It’s not a building that anybody I have would want.”