$42.7M foreclosure auction date set for 55-unit Hello Living rental in East Flatbush

The referee in a $42.7 million foreclosure case set the auction for the 55-unit building developed by Eli Karp’s Hello Living at 271 Lenox Road in East Flatbush, Brooklyn, for September 19, 2024, at the Kings Country Supreme Court building.
The total judgment as of March 2024 was calculated to be $42.75 million. The referee is attorney Michael Benjamin, and  the auction date was disclosed in a court filing yesterday.

Case 522282/2022 LINK

There were at least three major lawsuits related to the development. Lender Greystone & Company provided a $34.5 million loan in November 2019 to Hello Living, then filed the pre-foreclosure action on August 3, 2022. iCross Capital filed a suit against Hello Living over a $2.2 million loan, and Eli Karp sued the lender Madison Realty Capital, also in 2022, in a case that has been dismissed, though appealed.

The property

The elevator building with 55 residential units in East Flatbush has 75,871 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 99 feet and is 200 feet deep with a total lot size of 15,679 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 $15.4 million. The most recent loan totaled $34.5 million and was provided by Greystone & Co. on November 1, 2019.

Development

Eli Karp of Hello Living submitted a new building construction project for a 55-unit, 62,208 square-foot residential (R-2) building at 271 Lenox Road. The plan was filed on November 16, 2011 and was permitted on March 17, 2016. It calls for the construction of a 175-foot tall, 16-story building and was filed with the New York City Department of Buildings under job number 320396040. The project is described in the filing as: constructive of the new 55 units mixed use building basement, 16 story building as per plans proposed.

For the tax lot building, it received its initial certificate of occupancy on May 1, 2018.

Violations and lawsuits

According to city public data, the property has received eight housing violations, $2,510 in OATH penalties, and one housing litigation in the last year.

The neighborhood

In East Flatbush, The bulk, or 32 percent of the 42.6 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 24 percent of the space. In sales, East Flatbush has near average sales volume among other neighborhoods with $384.1 million in sales volume in the last two years and is the 18th highest in Brooklyn. For development, East Flatbush has near average amount of major developments among other neighborhoods and is the 9th highest in Brooklyn. It had 1.7 million square feet of commercial and multi-family construction under development in the last two years, which represents 4 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of 14 of the 18 commercial properties representing 589,467 square feet of the 634,529 square feet. The largest owner is Abraham Jeremias, followed by Barry Hers and then Bawabeh Realty Holdings. On the tax block, there were two new building construction projects totaling 196,830 square feet. The largest is a 165-unit, 134,622 square-foot residential (R-2) building submitted by K2 Real Estate Partners and filed by Andrew Klein with plans filed December 20, 2019 and permitted December 16, 2021. The second largest is a 55-unit, 62,208 square-foot residential (R-2) building submitted by Eli Karp with plans filed November 16, 2011 and permitted August 20, 2015.

The owner

The PincusCo database currently indicates that Hello Living owned at least three commercial properties with 134 residential units in New York City with 144,008 square feet and a city-determined market value of $27 million. (Market value is typically about 50% of actual value.) The portfolio has $49.5 million in debt, borrowed from Greystone & Co. and Cantor Commercial Real Estate Lending. Within the portfolio, all identified are elevator properties. They are all located in Brooklyn.

The owners according to the Department of Housing Preservation and Development includes David Vaughan, head officer and Royce Douglas, agent. The business entities are Bpc Management Corp. and David Vaughan As Receiver.

The surrounding

Within a 400-foot radius of 271 Lenox Road, PincusCo identified one commercial real estate item of interests occurred over the past 24 months. It was a permit issued on December 20, 2022 for the $1.5 million renovation of 10,837-square-foot residential (R-2) building with 17 residential units at 1359 Nostrand Avenue.

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