Acadia pays $35M for retail in Williamsburg near ESRT holdings

UPDATED, 8:15 a.m., October 24,2024: Acadia Realty Trust through the entity 123-129 N 6th Owner LLC paid $35 million to Vallario family and Ciuffo family through the entity North 6th Street Realty LLC for the retail building (K4) at 123 to 129 North 6th Street, also known as 141 Berry Street, in Williamsburg, Brooklyn. The expected use is cash flowing. The seller had owned the building for 42 years.
Empire State Realty Trust over the past year has spent $169 million in six acquisitions in Williamsburg, most on North 6th Street.
The deal closed on October 11, 2024 and was recorded on October 23, 2024. The property has 11,250 square feet of built space and 20,255 square feet of additional air rights for a total buildable of 31,485 square feet according to a PincusCo analysis of city data. The sale price per built square foot is $3,111 and the price per buildable square foot is $1,111 per the PincusCo analysis. (The price per square foot analysis is the transaction price divided by square feet as reported in public records and assumes no air rights have been sold.)
The signatory for Vallario family and Ciuffo family was Joseph P. Vallario. The signatory for Acadia Realty Trust was Jason Blacksberg. The contract date was September 11, 2024.

The Vallario and Ciuffo families partnered to form the food supply company M&V Provision Co. which bought the building from the city in 1982, approximately 42 years ago. Acadia Realty Truat has been an aggressive buyer, paying $5.7 million for Bleecker Street, 92 Perry Street, 382 Bleecker Street, and 382 Bleecker, Street and $4.77 million for 367-369 Bleecker Street from Brookfield Properties and then $43.4 million for 92 to 94 Greene Street from Continental Ventures.
A JLL team of Ethan Stanton, Brendan Maddigan and Michael Mazzara brokered both sides of the deal.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Acadia Realty Trust purchased 12 properties in six transactions for a total of $111.9 million  over the past 24 months.
The seller Vallario family had not purchased any other properties and had not sold any properties over the same time period. The 11,250-square-foot property generated revenue of $776,776 or $69 per square foot, according to the most recent income and expense figures.

The property

The retail building with 2 residential units in Williamsburg has 11,250 square feet of built space and 20,255 square feet of additional air rights for a total buildable of 31,485 square feet according to a PincusCo analysis of city data. The parcel has frontage of 82 feet and is 100 feet deep with a total lot size of 10,495 square feet. The lot is irregular. The zoning is M1-2/R6A which allows for up to 2 times floor area ratio (FAR) for manufacturing and up to 3 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $4.3 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property for the past 24 months. In addition, according to city public data, the property has not received any significant violations in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The neighborhood

In Williamsburg, The bulk, or 39 percent of the 50.4 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 25 percent of the space. In sales, Williamsburg has the 4th highest sale turnover among other neighborhoods in the city with $1.8 billion in sales volume in the last two years. For development, Williamsburg has 4.2 times the average amount of major developments relative to other neighborhoods and is the 2nd highest in Brooklyn. It had 4.7 million square feet of commercial and multi-family construction under development in the last two years, which represents 9 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of six of the 15 commercial properties representing 70,267 square feet of the 115,370 square feet. The largest owner is Jerry Lebedowicz, followed by Simon Schischa and then James Nunziata.
On the tax block, there were two new building construction projects totaling 30,093 square feet. The largest is a 16,750 square-foot mercantile (M) building submitted by L3 Capital and filed by Domenic Lanni with plans filed August 23, 2021 and permitted November 14, 2023. The second largest is a 12-unit, 13,343 square-foot residential (R-2) building submitted by Jerry Lebedowicz with plans filed February 26, 2008 and permitted July 8, 2022.

The majority, or 41 percent of the 115,370 square feet of built space are elevator buildings, with mixed-use buildings next occupying 33 percent of the space.

The buyer

The PincusCo database currently indicates that Acadia Realty Trust owned at least four commercial properties with 148 residential units in New York City with 245,911 square feet and a city-determined market value of $78.7 million. (Market value is typically about 50% of actual value.) The portfolio has $284.4 million in debt, with top three lenders as Bank of America, Bridge Investment Group, and TD Bank respectively. Within the portfolio, the bulk, or 41 percent of the 245,911 square feet of built space are retail properties, with D4 properties next occupying 38 percent of the space. The bulk, or 59 percent of the built space, is in Manhattan, with Queens next at 41 percent of the space.

Updated with broker information.

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