$15M bankruptcy filed at nearly-complete 45-unit Longwood rental
569 Prospect Avenue (Credit - Cyclomedia)
A bankruptcy specialist on behalf of developers Leopoldo Baez and Emanuel Kambanis, through the entity Valdesia Gardens Housing Development Fund Corporation, on December 13, 2024, submitted a $15 million chapter 11 bankruptcy petition seeking to block the December 16 foreclosure auction of the under-construction, 45-unit, mixed-use rental building at 569 Prospect Avenue in Longwood, the Bronx. Bankruptcy specialist David Goldwasser of FIA Capital Partners, filed the petition in U.S. Bankruptcy Court for the Southern District of New York.
State Court Case 807727/2022E LINK
Bankruptcy Case 24-23086-kyp LINK
The property is mid-construction and is valued at $15 million with debts of about $22 million, according to the filing.
The Goldwasser affidavit states, in part, “The Debtor intended to develop the Property into a community focused multi-family, mixed-use property with approximately 45 rental residential units and first floor commercial rental units. Unfortunately, the Debtor was only able to complete 85% of the project, with an additional $6 million still need to complete the project, which completion, upon funding, is expected to take approximately 9 months to complete. The Debtor estimates the… value to increase to $25 to $30 million upon completion. Due to the Debtor’s inability to complete the project due to its exhaustion of capital and the CPC financing, CPC obtained a foreclosure judgment against, inter alia, the Debtor on or about September 24, 2024 in the unpaid principal amount of $17,946,032.72 as of March 31, 2024, together with interest, costs, attorneys fees and post-judgment interest at the statutory rate of 9% per annum. A foreclosure sale was scheduled for December 16, 2024 at 2:30 p.m.”
Leopoldo Baez of Valdesia Holding Corp. submitted a new building construction project for a 45-unit, 47,737 square-foot residential (R-2) building at 569 Prospect Ave in Longwood, Bronx. The plan was filed with the New York City Department of Buildings on March 17, 2017 under job number 220152670 and was permitted on March 30, 2018. It calls for the construction of a seven-story building.
The property
The elevator building with 45 residential units in Longwood has 66,337 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 100 feet and is 100 feet deep with a total lot size of 10,000 square feet. The zoning is R7-1 which allows for up to 3.44 times floor area ratio (FAR) for residential. The city-designated market value for the property in 2022 is $6.3 million.
Violations and lawsuits
According to city public data, the property has received three DOB violations, $8,750 in ECB penalties, and $12,030 in OATH penalties in the last year.
The neighborhood
In Longwood, The bulk, or 44 percent of the 22.3 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 27 percent of the space. In sales, Longwood has near average sales volume among other neighborhoods with $86.3 million in sales volume in the last two years and is the 12th highest in Bronx. For development, Longwood has near average amount of major developments among other neighborhoods and is the 4th highest in Bronx. It had 1.5 million square feet of commercial and multi-family construction under development in the last two years, which represents 7 percent of the neighborhood’s built space.
The block
On this tax block, PincusCo has identified the owners of four of the 21 commercial properties representing 205,166 square feet of the 380,899 square feet. The largest owner is Benzion Wachsman, followed by Joe Hasselt and then Lemle & Wolff. On the tax block, there were two new building construction projects totaling 53,345 square feet. The largest is a 45-unit, 47,737 square-foot residential (R-2) building submitted by Leopoldo Baez with plans filed March 17, 2017 and permitted August 10, 2017. The second largest is a 12-unit, 5,608 square-foot residential (R-2) building submitted by Simon Neuman with plans filed January 4, 2022 and permitted January 4, 2023.
The surrounding
This is the first commercial real estate event of interest identified within the 400-foot radius of 569 Prospect Avenue in the past 24 months.
Direct link to the property’s ACRIS page and link to DOB NOW portal.