Bronx Pro Group acquires property valued at $14.1M for 244-unit affordable project in Morris Heights

The Bronx Pro Group through the entity Starhill Phase II Owner LLC acquired the 244-unit development (V0) site at 1600 Macombs Road in Morris Heights, Bronx, from the nonprofit Services for the Underserved, through a transfer valued at $14.1 million.

Development

On the lot, there is a new building project for a 244-unit, 436,185 square-foot residential (R-2) building submitted by Services for the Underserved and filed by Arlo Chase with plans filed February 13, 2020.
The sale and loan both closed on June 27, 2024 and were recorded on July 8, 2024.
Bronx Pro Group and Services for the Underserved through the entity Starhill Phase II Housing Development Fund Corp. as borrower signed a new construction loan with lender NYC Housing Development Corporation valued at $139.6 million.
The signatory for Services for the Underserved was Douglas Walerstein. The signatory for Bronx Pro Group was Douglas Walerstein. The contract date was September 30, 2021. This transfer is between two entities in care of Services for the Underserved, but the beneficial ownership of the buyer entity was simultaneously transferred to Bronx Pro Group, a for-profit developer of affordable housing founded by Peter Magistro and controlled by the Magistro family. The project is to build 244 units for low income households that includes 10,073 square feet of community facility space.

Prior sales and revenue

Prior to this transaction, PincusCo has no record that the buyer Bronx Pro Group had purchased any other properties and has no record it sold any properties over the past 24 months.
The seller Services for the Underserved purchased one properties in one transactions for a total of $20 million and had not sold any properties over the same time period. The former owners according to the Department of Housing Preservation and Development includes Cicely Cruz, head officer and Marcus Quintana, agent. The business entities are Services For The Underserved and Services For The Underserved.

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 not received any significant violations in the last year.

The neighborhood

In Morris Heights, The majority, or 70 percent of the 15.3 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 21 percent of the space. In sales, Morris Heights has the 42nd highest sale turnover among other neighborhoods in Bronx with $10.9 million in sales volume in the last two years. For development, Morris Heights has near average amount of major developments among other neighborhoods and is the 6th highest in Bronx. It had 999,243 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 six of the 17 commercial properties representing 348,566 square feet of the 607,030 square feet. The largest owner is Ved Parkash, followed by Michael Goldberg and then Matthew Schmelzer.
On the tax block, there were seven new building construction projects totaling 1,187,436 square feet. The largest is a 244-unit, 436,185 square-foot residential (R-2) building submitted by Services for the Underserved and filed by Arlo Chase with plans filed February 13, 2020 and it has not been permitted yet. The second largest is a 316-unit, 436,185 square-foot residential (R-2) building submitted by Services for the Underserved and filed by Arlo Chase with plans filed February 18, 2020 and permitted June 21, 2022.

The majority, or 45 percent of the 607,030 square feet of built space are elevator buildings, with specialty buildings next occupying 23 percent of the space.

The seller

The PincusCo database currently indicates that Services For The Underserved owned at least five commercial properties with 209 residential units in New York City with 115,661 square feet and a city-determined market value of $13.7 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 74 percent of the 115,661 square feet of built space are walkup properties, with elevator properties next occupying 26 percent of the space. The bulk, or 66 percent of the built space, is in Brooklyn, with Manhattan next at 34 percent of the space.

The buyer

The PincusCo database currently indicates that Bronx Pro Group owned at least 39 commercial properties with 1,360 residential units in New York City with 1,403,274 square feet and a city-determined market value of $80.3 million. (Market value is typically about 50% of actual value.) The portfolio has $181.7 million in debt, with top three lenders as NYC Housing, JPMorgan Chase, and Community Preservation Corporation respectively. Within the portfolio, the bulk, or 66 percent of the 1,403,274 square feet of built space are elevator properties, with walkup properties next occupying 30 percent of the space. The bulk, or 92 percent of the built space, is in Bronx, with Manhattan next at 8 percent of the space.

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