Canvas, Tokyu Land pays $112.8M for 150-unit rental in Downtown Brooklyn, Tokyu lends $57M

Robert Morgenstern’s Canvas Investment Partners and Tokyu Land US through the entity 430 Albee Bk Owner LLC paid $112.8 million to Spencer Equity Group through the entity Spencer Albee Equities LLC for the 150-unit rental condominium unit and a retail unit at 436 Albee Square, also known as 430 Albee Square, in Downtown Brooklyn. The expected use is cash flowing.
The deal closed on November 14, 2024 and was recorded on November 25, 2024. The two properties have 160,577 square feet of built space according to a PincusCo analysis of city data. The sale price per built square foot is $702 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 Spencer Equity Group was Joel Gluck. The signatory for Canvas Investment Partners and Tokyu Land US was Robert Morgenstern. The contract date was November 14, 2024.
The Real Deal reported on this earlier this month. Robert Morgenstern also owns property through Canvas Property Group, now described as the “services arm” for Canvas Investment Partners, and previously he owned through Morgenstern Capital. Before that he was with Stone Street Properties.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Canvas Investment Partners purchased two other properties for $104.5 million over the past 24 months.
The seller Spencer Equity Group had not purchased any other properties and sold seven properties in five transactions for a total of $107.5 million over the same time period.

The property

The rental condos with 150 residential units in Downtown Brooklyn has 160,577 square feet of built space according to a PincusCo analysis of city data. The parcel has a total lot size of 129,410 square feet. The property has a 421A exemption that started in 2020 and expires in 2035. The city-designated market value for the property in 2022 is $36.9 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties for the past 24 months. In addition, according to city public data, the properties have not received any significant violations in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The block

On the tax block of 430 Albee Square, PincusCo has identified the owners of three of the seven commercial properties representing 262,607 square feet of the 684,181 square feet. The largest owner is Michael Chera, followed by Daniel Gazal and then Webster Apartments.
On the tax block, there were four new building construction projects totaling 499,349 square feet. The largest is a 387,801 square-foot business (B) building submitted by JEMB Realty and filed by Morris Jerome with plans filed September 20, 2017 and permitted February 13, 2018. The second largest is a 110-unit, 89,295 square-foot residential (R-2) building submitted by Daniel Gazal with plans filed April 28, 2014 and permitted March 10, 2016.

The majority, or 58 percent of the 684,181 square feet of built space are office buildings, with retail buildings next occupying 20 percent of the space.

The seller

The PincusCo database currently indicates that Spencer Equity Group owned at least nine commercial properties with 604 residential units in New York City with 484,333 square feet and a city-determined market value of $56.3 million. (Market value is typically about 50% of actual value.) The portfolio has $125.2 million in debt, with top three lenders as Sterling National Bank, Santander Bank, and Signature Bank respectively. Within the portfolio, the bulk, or 90 percent of the 484,333 square feet of built space are elevator properties, with walkup properties next occupying 10 percent of the space. The bulk, or 94 percent of the built space, is in Brooklyn, with Manhattan next at 6 percent of the space.

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