Carlyle Group affiliate pays $5M for residential walkup in Bushwick

The Carlyle Group affiliate Townhouse Rental II, L.L.C. paid $5 million to Jacob Fulop and Jacob Lefkowitz through the entity 306 JF LLC for the midblock eight-unit residential walkup building at 306 Stockholm Street in Bushwick, Brooklyn.
The deal closed on March 31, 2022 and was recorded on May 25, 2022. The property has 5,970 square feet of built space and 100 square feet of additional air rights for a total buildable of 6,075 square feet according to PincusCo analysis of city data. The sale price per built square foot is $837 and the price per buildable square foot is $823 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 seller bought the property on May 19, 2016, for $1.1 million. The signatory for Jacob Fulop and Jacob Lefkowitz was Jacob Fulop and Jacob Lefkowitz. The signatory for Townhouse Rental II, L.L.C. and Carlyle Group was Carter Martin.

Prior sales and revenue

Prior to this transaction, Pincusco has records that the buyer Townhouse Rental II, L.L.C. purchased 44 properties in 44 transactions for a total of $169.7 million and has no record it sold any properties over the past 24 months.
The seller Jacob Fulop purchased five properties in five transactions for a total of $14 million and sold four properties in four transactions for a total of $10.8 million over the same time period. The current owners according to the Department of Housing Preservation and Development include Carter Martin, head officer and Marci Soifer, site manager. The business entity is Townhouse Rental LLC.

The property

The 306 Stockholm parcel has frontage of 25 feet and is 100 feet deep with a total lot size of 2,500 square feet. The zoning is R6 which allows for up to 2.43 times floor area ratio (FAR) for residential. The property has a 421A exemption that started in 2019.0 and expires in 2055.0. The city-designated market value for the property in 2022 is $1.2 million.

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 $50 in OATH penalties in the last year.

Development

For the tax lot building, it received its initial alteration certificate of occupancy on December 31, 2018. 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 Bushwick, the bulk, or 32 percent of the 51.4 million square feet of commercial built space are 1-4 family buildings, with residential walkup buildings next occupying 29 percent of the space. In sales, Bushwick has 3.3 times the average sales volume among other neighborhoods with $910.2 million in sales volume in the last two years and is the 3rd highest in Brooklyn. For development, Bushwick has 1.2 times the average amount of major developments relative to other neighborhoods and is the 18th highest in Brooklyn. It had 1.1 million square feet of commercial and multi-family construction under development in the last two years, which represents 2 percent of the neighborhood’s built space. There were 11 pre-foreclosure suit filed among other residential walkup buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of 13 of the 42 commercial properties representing 68,354 square feet of the 232,111 square feet. The largest owner is Charles Papaconstantinou, followed by Roni Abudi and then Moses Mizrahi. There are no active new building construction projects on this tax block.

The majority, or 55 percent of the 243,791 square feet of built space are residential walkup buildings, with mixed-use buildings next occupying 26 percent of the space.

The seller

The PincusCo database currently indicates that Jacob Fulop owned at least 11 commercial properties with 71,255 square feet and a city-determined market value of $13 million. (Market value is typically about 50% of actual value.) The portfolio has $40.2 million in debt, with top three lenders as Bank Leumi, Bank of Princeton, and Arbor Realty Trust respectively. Within the portfolio, the bulk, or 59 percent of the 71,255 square feet of built space are residential walkup properties, with mixed-use properties next occupying 25 percent of the space. The bulk, or 74 percent of the built space, is in Brooklyn, with Manhattan next at 26 percent of the space.

The buyer

The PincusCo database currently indicates that Carlyle Group owned at least 37 commercial properties with 566,465 square feet and a city-determined market value of $122.5 million. (Market value is typically about 50% of actual value.) The portfolio has $323.6 million in debt, with top three lenders as Invesco, Santander Bank, and Citibank respectively. Within the portfolio, the bulk, or 64 percent of the 566,465 square feet of built space are residential elevator properties, with specialty properties next occupying 13 percent of the space. The bulk, or 57 percent of the built space, is in Brooklyn, with Queens next at 43 percent of the space.
The PincusCo database currently indicates that Townhouse Rental II, L.L.C. owned at least 36 commercial properties with 159,315 square feet and a city-determined market value of $42.9 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 57 percent of the 159,315 square feet of built space are residential walkup properties, with 1-4 family properties next occupying 36 percent of the space. The bulk, or 81 percent of the built space, is in Brooklyn, with Queens next at 19 percent of the space.

Surrounding

Within a 400-foot radius of 306 Stockholm, Pincusco identified one commercial real estate item of interests occurred over the past 24 months.
It was a loan which Jacob Fulop borrowed $5.5 million from Arbor Realty Trust secured by the 5,848-square-foot, six-unit rental (C2) on 291 Stockholm Street and one other property on June 23, 2021.

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