Albert Srour signs $26.4M refi for office building in Garment District

Albert Srour through the entity 248 West 35th Street, LLC as borrower signed a refi loan with lender New York Community Bank valued at $26.4 million for the office building (O6) at 248 West 35th Street in Garment District, Manhattan.
The deal closed on September 13, 2022 and was recorded on October 7, 2022. The prior lender was New York Community Bank which held debt that had an original loan amount of $32.5 million. The property has 133,948 square feet of built space according to PincusCo analysis of city data. The loan price per built square foot is $197 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 Albert Srour was Albert Srour. The signatory for New York Community Bank was Alan L. Kaufman.

Prior sales and revenue

The 133,948-square-foot property generated revenue of $3.9 million or $29 per square foot, according to the most recent income and expense figures.

The property

The 248 West 35th Street parcel has frontage of 75 feet and is 98 feet deep with a total lot size of 7,406 square feet. The zoning is M1-6 which allows for up to 10 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $15.2 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property since September of 2020. In addition, according to city public data, the property has received one DOB violation and $1,880 in OATH penalties in the last year.

Development

For the tax lot building, it received its initial rehab certificate of occupancy on April 3, 2018. There are no active new building construction projects or major alteration projects with initial costs more than $5 million on this tax lot.

The neighborhood

In Garment District, the majority, or 70 percent of the 51.9 million square feet of commercial built space are office buildings, with hotel buildings next occupying 12 percent of the space. In sales, Garment District has 2.9 times the average sales volume among other neighborhoods with $1 billion in sales volume in the last two years and is the 15th highest in Manhattan. For development, Garment District has 1.5 times the average amount of major developments relative to other neighborhoods and is the 17th highest in Manhattan. It had 1.5 million square feet of commercial and multi-family construction under development in the last two years, which represents 3 percent of the neighborhood’s built space. There were two pre-foreclosure suit filed among other office buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of 11 of the 27 commercial properties representing 244,287 square feet of the 2,105,855 square feet. The largest owner is General Leasing & Management, followed by Churchill Real Estate Holdings and then Vornado Realty Trust.
On the tax block, there were five new building construction projects totaling 273,414 square feet. The largest is a 300-unit, 157,517-square-foot R-1 building developed by Meyer Chetrit with plans filed April 5, 2016 and permitted August 21, 2017. The second largest is a 180-unit, 45,026-square-foot R-1 building developed by Isaac Hager with plans filed January 6, 2014 and it has not been permitted yet.

The majority, or 78 percent of the 2.1 million square feet of built space are office buildings, with hotel buildings next occupying 10 percent of the space.

The borrower

The PincusCo database currently indicates that Albert Srour owned at least 13 commercial properties in New York City with 582,483 square feet and a city-determined market value of $56.5 million. (Market value is typically about 50% of actual value.) The portfolio has $106.5 million in debt, with top three lenders as Signature Bank, New York Community Bank, and Investors Bank respectively. Within the portfolio, the bulk, or 37 percent of the 582,483 square feet of built space are elevator properties, with walkup properties next occupying 20 percent of the space. The bulk, or 95 percent of the built space, is in Brooklyn, with Manhattan next at 5 percent of the space.

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