$11.9M pre-foreclosure filed at Allied Properties nearly finished Bay Ridge office building

An affiliate of ASLD Realty as well as and Dime Community Bank, filed an $11.9 million pre-foreclosure action at the Tim Ziss-led Allied Properties’ under-construction office building at 437 88th Street in Bay Ridge, Brooklyn, in State Supreme Court in Brooklyn yesterday. The developer has applied for a certificate of occupancy but the city has not yet issued one.

Tim Ziss’s Allied Properties bought the property in January 29, 2018 for $6.95 million, and in November 2019 refinanced with $12.3 million from Dime Community Bank. That loan was modified and restated as $11.9 million in June 2022. On June 11, 2024, Dime Community Bank sold the note to Steve Hackel’s ASLD Realty, but Dime retained an interest in a loan-on-loan structure. BD 43788 LLC and Dime Community Bank are named as plaintiffs in the action. The complaint alleges the borrower defaulted by not repaying the loan on its revised maturity date of June 10, 2024, among other allegations.
ASLD Realty has purchased several notes in recent years.

Court filings represent the position of one party and are not necessarily accurate or complete.
Case 522507/2024 LINK

According to the complaint, “Borrower acknowledged that interest at the Default Rate has been accruing since January 1, 2024…Borrower failed to obtain a temporary certificate of occupancy for the Mortgaged Premises by May 25, 2021… As of the date hereof, Borrower failed to obtain a temporary certificate of occupancy… Borrower defaulted under the Loan Documents by failing to tender the amounts due under the Loan Documents by the June 10, 2024 Maturity Date.”

2017 Major Alteration

Tim Ziss of 437 88 LLC submitted a major alteration application for a renovation and expansion of a 12,228 square-foot commercial (COM) building at 437 88th Street in Bay Ridge, Brooklyn. The plan was filed with the New York City Department of Buildings on July 11, 2017 under job number 321615365 and was permitted on November 21, 2019, but the city has not yet issued a certificate of occupancy. Allied applied for one in December 2023. The alteration plan called for the increase in size of the building from a two-story building to a four-story building. The project is described in the filing as: changing use and lowering cellar, eliminating basement level and adding two floors to existing structure creating a four-story fireproof building new egress and elevators as as shown on plans.
The major alteration plan was filed one day before Allied Properties signed a contract on July 12, 2017, to buy the property. Allied later closed on the purchase in January 2018.

The property

The office building in Bay Ridge has 38,621 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 100 feet and is 125 feet deep with a total lot size of 10,200 square feet. The lot is irregular. The zoning is C8-2 which allows for up to 2 times floor area ratio (FAR) for commercial. The city-designated market value for the property in 2022 is $3 million. The most recent loan totaled $10.5 million and was provided by Dime Community Bank on June 1, 2022.

Prior sales and revenue

This property was sold for $7 million on January 29, 2018.

The 38,621-square-foot property generated revenue of $302,010 or $8 per square foot, according to the most recent income and expense figures.

Violations and lawsuits

According to city public data, the property has received four DOB violations in the last year.

There were no lawsuits or bankruptcies filed against the property for the past 24 months, prior to this action.

The neighborhood

In Bay Ridge, The bulk, or 30 percent of the 21 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 28 percent of the space. In sales, Bay Ridge has near average sales volume among other neighborhoods with $259.1 million in sales volume in the last two years and is the 25th highest in Brooklyn. For development, Bay Ridge has near average amount of major developments among other neighborhoods and is the 29th highest in Brooklyn. It had 343,116 square feet of commercial and multi-family construction under development in the last two years, which represents 2 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of eight of the 18 commercial properties representing 238,288 square feet of the 333,775 square feet. The largest owner is Allied Properties, followed by ASG Equities and then Fotios Eugenis. There are no active new building construction projects on this tax block.

The owner

The PincusCo database currently indicates that Allied Properties owned at least two commercial properties in New York City with 117,794 square feet and a city-determined market value of $15.7 million. (Market value is typically about 50% of actual value.) The portfolio has $22.5 million in debt, borrowed from Madison Realty Capital and Dime Community Bank. Within the portfolio, all identified are office properties. They are all located in Brooklyn.

The surrounding

Within a 400-foot radius of 447 88 Street, PincusCo identified one commercial real estate item of interests occurred over the past 24 months. It was a loan which ASG Equities borrowed $20 million from Peapack-Gladstone Bank secured by the 30,000-square-foot, one-unit mixed-use building (K4) on 454 86th Street and five other properties on November 14, 2023.

Direct link to the property’s ACRIS page and link to DOB NOW portal.