Apex Building Group signs $103.9M construction loan for 123-unit development in East New York

Apex Building Group through the entity C3 Vital Bk Housing Development Fund Corporation as borrower signed a new construction loan with lender NYS Housing Finance Agency valued at $103.9 million at the 123-unit development at 11655 Seaview Avenue in East New York, Brooklyn.
The deal closed on June 16, 2022 and was recorded on August 29, 2022. The property has 442,575 square feet of built space and 171,869 square feet of additional air rights for a total buildable of 613,818 square feet according to PincusCo analysis of city data. The loan price per built square foot is $234 and the price per buildable square foot is $169 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 owner bought the property on December 16, 2021, for $25 million. The signatory for Apex Building Group was Lee A. Brathwaite. Apex is the tenant with L+M Development Partners as the landlord under a 99-year ground lease signed simultaneously that did not have an economic value.

The property

The 11655 Seaview Avenue parcel has frontage of 1,165 feet and is 1,064 feet deep with a total lot size of 1,227,637 square feet. The lot is irregular. The zoning is R3-2 which allows for up to 0.5 times floor area ratio (FAR) for residential. The city-designated market value for the property in 2022 is $46.3 million.The most recent loan totaled $71.8 million and was provided by NYS Housing Finance Agency on December 16, 2021.

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 $13,600 in OATH penalties in the last year.

Development

On these lots, there are three active new building construction projects and major alteration projects with initial costs more than $5 million, totaling 499,952 square feet. The largest is a new building project for a 437-unit, 386,362-square-foot R-2 building developed by David Dishy with plans filed July 16, 2021 and it has not been permitted yet. The second largest is a new building project for a 123-unit, 107,814-square-foot R-2 building developed by Lee Brathwaite with plans filed July 20, 2021 and it has not been permitted yet.

The neighborhood

In East New York, the bulk, or 40 percent of the 44.6 million square feet of commercial built space are elevator buildings, with industrial buildings next occupying 21 percent of the space. In sales, East New York has the 3rd highest sale turnover among other neighborhoods in the city with $2.6 billion in sales volume in the last two years. For development, East New York has 2.8 times the average amount of major developments relative to other neighborhoods and is the 6th highest in Brooklyn. It had 3 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 seven of the nine commercial properties representing 1,192,729 square feet of the 1,256,132 square feet. The largest owner is Arker Companies, followed by L+M Development Partners and then Block Institute.
There are eight active new building construction projects totaling 1,366,428 square feet. The largest is a 437-unit, 386,362-square-foot R-2 building developed by David Dishy with plans filed July 16, 2021 and it has not been permitted yet.The second largest is a 422-unit, 363,548-square-foot R-2 building developed by Alex Arker with plans filed January 26, 2018 and permitted August 1, 2018.

the majority, or 38 percent of the 1.2 million square feet of built space are specialty buildings, with elevator buildings next occupying 37 percent of the space.

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