Avdoo & Partners pays $29.4M for dev site in Gowanus

Avdoo & Partners Development through the entity Union Street Owner LLC paid $29.4 million to S.J. Fuel Co. through the entity 601 Union Street Realty Corp. for the industrial building (G1) at 601 Union Street in Gowanus, Brooklyn and an adjacent vacant parcel with an address on Sackett Street. The expected use is ground up development.
The deal closed on December 23, 2024 and was recorded on December 27, 2024. The two properties have 22,699 square feet of built space and 127,472 square feet of additional air rights for a total buildable of 150,212 square feet according to a PincusCo analysis of city data. The sale price per built square foot is $1,295 and the price per buildable square foot is $195 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 S.J. Fuel Co. was Peter D’Arco. The signatory for Avdoo & Partners Development was Shlomi Avdoo [LINK]. The contract date was October 27, 2022. PincusCo reported on the sale in November 2023 after it went into contract. The initial contract date was memorialized in the termination of memorandum of contract.

Avdoo & Partners Development obtained a $16.1 million land loan from Bank Hapoalim for the acquisition.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Avdoo & Partners Development purchased seven properties in three transactions for a total of $20.1 million and has no record it sold any properties over the past 24 months.
The seller S.J. Fuel Co. had not purchased any other properties and sold three properties in one transaction for a total of 0.0 over the same time period.

The property

The industrial building in Gowanus has 22,699 square feet of built space and 127,472 square feet of additional air rights for a total buildable of 150,212 square feet according to a PincusCo analysis of city data. The parcel has frontage of 190 feet and is 110 feet deep with a total lot size of 21,055 square feet. The zoning is M1-4/R7A which allows for up to 2 times floor area ratio (FAR) for manufacturing and up to 4 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $2.3 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties for the past 24 months. In addition, according to city public data, the properties have received one DOB violation, $2,500 in ECB penalties, and $4,150 in OATH penalties 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 Gowanus, The bulk, or 46 percent of the 9.2 million square feet of commercial built space are industrial buildings, with elevator buildings next occupying 19 percent of the space. In sales, Gowanus has 2.4 times the average sales volume among other neighborhoods with $603.8 million in sales volume in the last two years and is the 7th highest in Brooklyn. For development, Gowanus has 2.8 times the average amount of major developments relative to other neighborhoods and is the 3rd highest in Brooklyn. It had 3 million square feet of commercial and multi-family construction under development in the last two years, which represents 33 percent of the neighborhood’s built space.

The block

On the tax block of 601 Union Street, PincusCo has identified the owners of four of the 16 commercial properties representing 62,479 square feet of the 122,107 square feet. The largest owner is Three Wall Capital, followed by Avdoo & Partners Development and then Avery Hall Investments.
On the tax block, there were two new building construction projects totaling 177,877 square feet. The largest is a 193-unit, 161,490 square-foot residential (R-2) building submitted by Avery Hall and filed by Alexander Cutrona with plans filed December 8, 2021 and permitted August 9, 2023. The second largest is a 22-unit, 16,387 square-foot residential (R-2) building submitted by David Kabasso and filed by Dave K with plans filed March 10, 2022 and it has not been permitted yet.

The majority, or 51 percent of the 122,107 square feet of built space are hotel buildings, with industrial buildings next occupying 32 percent of the space.

The buyer

The PincusCo database currently indicates that Avdoo & Partners Development owned at least 14 commercial properties with 168 residential units in New York City with 158,143 square feet and a city-determined market value of $30.8 million. (Market value is typically about 50% of actual value.) The portfolio has $183.1 million in debt, with top three lenders as Valley National Bank, Bank Leumi, and Kearny Bank respectively. Within the portfolio, the bulk, or 22 percent of the 158,143 square feet of built space are retail properties, with mixed-use properties next occupying 22 percent of the space. They are all located in Brooklyn.

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