Brodsky Organization signs $144M refi with Athene for 316-unit building in Prospect Heights

Brodsky Organization through the entity 662 Pacific Owner LLC as borrower signed a refi loan with lender Athene Annuity And Life Company valued at $144 million for the 316-unit residential elevator building at 662 Pacific Street in Prospect Heights, Brooklyn.
The deal closed on May 17, 2022 and was recorded on May 23, 2022. The prior lender was Bank of New York Mellon which held debt that had an original loan amount of $144 million. The property has 370,789 square feet of built space according to PincusCo analysis of city data. The loan price per built square foot is $388 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 Brodsky Organization was Daniel Brodsky. The signatory for Athene Annuity And Life Company was Michael Lolito.

Prior sales and revenue

The 370,789-square-foot property generated revenue of $15.8 million or $43 per square foot, according to the most recent income and expense figures.

The property

The 662 Pacific Street parcel has frontage of 131 feet and is 40 feet deep with a total lot size of 19,537 square feet. The lot is irregular. The zoning is R6B which allows for up to 2 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $21.2 million. The most recent loan totaled $144 million and was provided by Bank of New York Mellon on September 4, 2019.

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 $300 in OATH penalties in the last year.

Development

For the tax lot building, it received its initial certificate of occupancy on January 9, 2013. On these lots, there is one active new building construction project for a 316-unit, 370,789-square-foot R-2 building. The project was developed by Jon Adamski with plans filed September 18, 2015 and permitted February 6, 2020.

The neighborhood

In Prospect Heights, the bulk, or 37 percent of the 11.8 million square feet of commercial built space are residential elevator buildings, with 1-4 family buildings next occupying 20 percent of the space. In sales, Prospect Heights has had very little sales volume relative to other neighborhoods with $65 million in sales volume in the last two years. For development, Prospect Heights has 3 times the average amount of major developments relative to other neighborhoods and is the 6th highest in Brooklyn. It had 2.7 million square feet of commercial and multi-family construction under development in the last two years, which represents 23 percent of the neighborhood’s built space. There was one pre-foreclosure suit filed among other residential elevator buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of three of the 16 commercial properties representing 385,369 square feet of the 544,303 square feet. The largest owner is Brodsky Organization, followed by Joseph Banda and then Vernetta Nelson. There is one active new building construction project totaling 370,789 square feet. It is a 316-unit, 370,789-square-foot R-2 building developed by Jon Adamski with plans filed September 18, 2015 and permitted February 6, 2020.

The majority, or 80 percent of the 565,783 square feet of built space are residential elevator buildings, with residential walkup buildings next occupying 8 percent of the space.

The borrower

The PincusCo database currently indicates that Brodsky Organization owned at least seven commercial properties with 2,010,731 square feet and a city-determined market value of $191.2 million. (Market value is typically about 50% of actual value.) The portfolio has $430.1 million in debt, with top three lenders as AXA Equitable, Bank of New York Mellon, and Wells Fargo respectively. Within the portfolio, the bulk, or 99 percent of the 2,010,731 square feet of built space are residential elevator properties, with residential walkup properties next occupying 1 percent of the space. The bulk, or 58 percent of the built space, is in Brooklyn, with Manhattan next at 42 percent of the space.

Surrounding

Within a 400-foot radius of 662 Pacific Street, PincusCo identified one commercial real estate item of interests occurred over the past 24 months.
It was a loan which Resk Ali borrowed $7.5 million from New York Community Bank secured by the 3,840-square-foot, seven-unit mixed-use building (S5) on 475 Bergen Street and three other properties on July 8, 2021.

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