Bayrock Capital pays $24M for hotel in Long Island City

Bayrock Capital through the entity 44-21 9th Street LLC paid $24 million to Mandy Lema, Xiaodong Zhao, and Joseph Huang through the entity 4429 Hospitality Group LLC for the hotel building (H3) at 44-21 9th Street in Long Island City, Queens. Bayrock has been an active buyer over the past year.
The deal closed on October 23, 2023 and was recorded on October 31, 2023. The property has 49,001 square feet of built space according to a PincusCo analysis of city data. The sale price per built square foot is $489 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 seller bought the property on September 11, 2008, for $6.5 million. The signatory for Mandy Lema, Xiaodong Zhao, and Joseph Huang was Mandy Lema. The signatory for Bayrock Capital was Daniel Rabinowitz. The contract date was September 21, 2023. The owners use versions of the name Castlerock and Castle Rock Hospitality Group.

To finance the purchase, Bayrock Capital through the entity 44-21 9th Street LLC as borrower signed an acquisition loan with lender Levon Capital through the entity Levon Ny VIIXXIII LLC valued at $17.6 million.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Bayrock Capital purchased eight properties in seven transactions for a total of $149.9 million and has no record it sold any properties over the past 24 months.
The seller Mandy Lema had not purchased any other properties and had not sold any properties over the same time period. The former owners according to the Department of Housing Preservation and Development includes Andrew Taymans, head officer and Jelissa Rodriguez, site manager. The business entity is Liny Associates Llc.

The property

The hotel building in Long Island City has 49,001 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 211 feet and is 105 feet deep with a total lot size of 20,659 square feet. The lot is irregular. The zoning is M1-4 which allows for up to 2 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $10.2 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 received $300 in OATH penalties in the last year.

Development

For the tax lot building, it received its initial certificate of occupancy on September 21, 2012. 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 Long Island City, The bulk, or 32 percent of the 60.1 million square feet of commercial built space are industrial buildings, with elevator buildings next occupying 31 percent of the space. In sales, Long Island City has the 9th highest sale turnover among other neighborhoods in the city with $1.9 billion in sales volume in the last two years. For development, Long Island City is the 4th most active neighborhood among other neighborhoods. It had 8.6 million square feet of commercial and multi-family construction under development in the last two years, which represents 14 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of one of the three commercial properties representing 35,000 square feet of the 88,116 square feet. The identified owner is Broadway Stages.
There are no active new building construction projects on this tax block.

The majority, or 56 percent of the 88,116 square feet of built space are hotel buildings, with elevator buildings next occupying 40 percent of the space.

The buyer

The PincusCo database currently indicates that Bayrock Capital owned at least 16 commercial properties with 135 residential units in New York City with 432,975 square feet and a city-determined market value of $106.9 million. (Market value is typically about 50% of actual value.) The portfolio has $275 million in debt, with top three lenders as Broadview Capital, Popular Bank, and M&T Bank respectively. Within the portfolio, the bulk, or 77 percent of the 432,975 square feet of built space are hotel properties, with walkup properties next occupying 14 percent of the space. The bulk, or 88 percent of the built space, is in Queens, with Bronx next at 6 percent of the space.

Direct link to Acris document. link