Blackstone signs $96.6M refi with New York Life for seven properties in Brooklyn

Blackstone Group through the entity Breit Canarsie Owner LLC as borrower signed a refi loan with lender New York Life Insurance Company valued at $96.6 million for seven properties including the mixed-use building (K8) at 8719 Avenue D in Canarsie, Brooklyn, retail building (K6) at 8725 Foster Avenue in Canarsie, Brooklyn, and retail building (K6) at 856 Remsen Avenue in East Flatbush, Brooklyn.
The deal closed on January 24, 2023 and was recorded on February 1, 2023. The prior lender was PNC Bank which held debt that had an original loan amount of $80.4 million.The seven properties have 288,407 square feet of built space and 284,961 square feet of additional air rights for a total buildable of 519,026 square feet according to PincusCo analysis of city data. The loan price per built square foot is $334 and the price per buildable square foot is $186 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 Blackstone Group was Jack Dudley.

Because multiple properties have been transacted, some of the following sections will follow the property with the largest assessed value, which in this case, is the property on 8719 Avenue D.

Prior sales and revenue

Out of the seven properties, six with a total of 288,407 square feet of built space generated revenue of $12.9 million per year.

The property

The 8719 Avenue D parcel has frontage of 314 feet and is 500 feet deep with a total lot size of 180,588 square feet. The lot is irregular. The zoning is M1-1 which allows for up to 1 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $91.6 million.The most recent loan totaled $80.4 million and was provided by PNC Bank on December 11, 2019.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties since September of 2020. In addition, according to city public data, the properties have received two DOB violations, $3,125 in ECB penalties, and $14,250 in OATH penalties in the last year.

Development

For the tax lot buildings, four out of the seven buildings received a initial certificate of occupancy in the last ten years. 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 Canarsie, the bulk, or 28 percent of the 11.7 million square feet of commercial built space are elevator buildings, with industrial buildings next occupying 25 percent of the space. In sales, Canarsie has the 42nd highest sale turnover among other neighborhoods in Brooklyn with $45.7 million in sales volume in the last two years. For development, Canarsie has had very little major development activity relative to other neighborhoods.It had 57,991 square feet of commercial and multi-family construction under development in the last two years, which represents 0.49 percent of the neighborhood’s built space.

The block

On the tax block of 8719 Avenue D, PincusCo has identified the owners of eight of the 11 commercial properties representing 288,407 square feet of the 548,407 square feet. The two identified owners are LIRR and Blackstone Group.
There are no active new building construction projects on this tax block.

The majority, or 89 percent of the 548,407 square feet of built space are mixed-use buildings, with retail buildings next occupying 11 percent of the space.

The borrower

The PincusCo database currently indicates that Blackstone Group owned at least 53 commercial properties in New York City with 15,861,560 square feet and a city-determined market value of $2.3 billion. (Market value is typically about 50% of actual value.) The portfolio has $857.1 million in debt, with top three lenders as Morgan Stanley, TIAA, and PNC Bank respectively. Within the portfolio, the bulk, or 90 percent of the 15,861,560 square feet of built space are elevator properties, with industrial properties next occupying 6 percent of the space. The bulk, or 80 percent of the built space, is in Manhattan, with Queens next at 16 percent of the space.

Direct link to Acris document. link