Bruce Teitelbaum, Harry Sussman sign $165M refi loan with MSD Partners following settlement with Durst in LIC

Bruce Teitelbaum and Harry Sussman through the entity 44-02 Ventures LLC as borrowers signed a refi loan with lender MSD Partners through the entity Msd Pcof Partners LII LLC valued at $165 million for three development parcels at 44-02 Vernon Boulevard and 44-00 Vernon Boulevard in Long Island City, Queens.
The deal closed on May 3, 2022 and was recorded on May 24, 2022. The prior lender was Durst Organization which held debt that had a court-set debt amount of $69.3 million in 2020. The three properties have zero square feet of built space and 1,160,356 square feet of additional air rights for a total buildable of 1,160,356 square feet according to PincusCo analysis of city data. The loan price per buildable square foot is $142 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 Bruce Teitelbaum and Harry Sussman was Harry Sussman. The signatory for MSD Partners was Kenneth Gerold. The borrowers ended a decade-long litigation with the Durst Organization which filed to foreclose on a loan secured by the property. The loan payoff was approximately $96.9 million, according to The Real Deal, which cited Durst for the figure. The court determined in 2020 the amount at the time to be $69.3 million. Bruce Teitelbaum presented plans for a green energy project at the parcel.

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 44-02 Vernon Boulevard.

The property

The 44-02 Vernon Boulevard parcel has frontage of 200 feet and is 781 feet deep with a total lot size of 128,332 square feet. The lot is irregular. The zoning is R7A which allows for up to 4 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $16.2 million.

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 $2,250 in ECB penalties and $2,250 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 $5 million on this tax lot.

The neighborhood

In Long Island City, the bulk, or 33 percent of the 66.2 million square feet of commercial built space are residential elevator buildings, with industrial buildings next occupying 30 percent of the space. In sales, Long Island City has 4.2 times the average sales volume among other neighborhoods with $1.2 billion in sales volume in the last two years and is the highest in Queens. For development, Long Island City is the 2nd most active neighborhood among other neighborhoods. It had 9.2 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.

Surrounding

PincusCo has not identified any commercial real estate items of interest within a 400-foot radius of 44-02 Vernon Boulevard that occurred over the past 24 months.

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