Carlyle Group signs $57.8M loan with Invesco for 27 properties in Brooklyn, Queens

Carlyle Group through the entity Townhouse Rental, L.L.C. as borrower signed a loan with lender Invesco Real Estate through the entity Invesco CMI Investments, L.P. valued at $57.8 million covering 27 properties with 96 residential units including the two-unit 1-4 family building (B2) at 1217 Decatur Street in Bushwick, Brooklyn, 10-unit residential walkup building (C1) at 212 Malcolm X Boulevard in Bedford Stuyvesant, Brooklyn, and four-unit mixed-use building (S4) at 116 Wyckoff Avenue in Bushwick, Brooklyn. The financing includes $49.6 million in new debt. 26 properties are located in Brooklyn and one in Queens.
At some of the buildings, including 116 Wyckoff Avenue, Carlyle Group has not yet recorded a deed transfer indicating it owns the building.
The loan closed on September 25, 2023 and was recorded on October 19, 2023. The 27 properties have 96,802 square feet of built space and 34,958 square feet of additional air rights for a total buildable of 125,391 square feet according to a PincusCo analysis of city data. The loan price per built square foot is $596 and the price per buildable square foot is $460 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 Carlyle Group was Jason Hart.

Development

For the tax lot buildings, six out of the 27 buildings received a initial certificate of occupancy in the last ten years. There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot. On one of the tax lots, the most recent condominium plan was filed by 1238 HANCOCK ST LLC to create 6 residential units in a building at 1238 Hancock Street in Bushwick, Brooklyn, called 496 Wilson Avenue Condominium that has a $4.2 million sellout, according to an April 4, 2022 submission to the New York State Attorney General. The principal of the sponsor, 1238 HANCOCK ST LLC, was Ran Michaeli. Michaeli sold the building to Carlyle for $4 million in April 2023.

The neighborhood

In Brooklyn Heights, the bulk, or 26 percent of the 12 million square feet of commercial built space are office buildings, with elevator buildings next occupying 23 percent of the space. In sales, Brooklyn Heights has 1.8 times the average sales volume among other neighborhoods with $630.3 million in sales volume in the last two years and is the 9th highest in Brooklyn. For development, Brooklyn Heights has had very little major development activity relative to other neighborhoods.It had 352,663 square feet of commercial and multi-family construction under development in the last two years, which represents 3 percent of the neighborhood’s built space. There were two pre-foreclosure suit filed among other mixed-use buildings in the past 12 months.

The block

On the tax block of 309 Henry Street, PincusCo has identified the owners of 11 of the 15 commercial properties representing 132,596 square feet of the 156,620 square feet. The largest owner is Todd Rose, followed by Sandra Dowling and then Nasser Ghorchian.
There are no active new building construction projects on this tax block.

The majority, or 47 percent of the 156,620 square feet of built space are elevator buildings, with mixed-use buildings next occupying 31 percent of the space.

The borrower

The PincusCo database currently indicates that Carlyle Group owned at least 255 commercial properties with 2,479 residential units in New York City with 2,864,650 square feet and a city-determined market value of $752.2 million. (Market value is typically about 50% of actual value.) The portfolio has $1.2 billion in debt, with top three lenders as Invesco Real Estate, Invesco, and Santander Bank respectively. Within the portfolio, the bulk, or 53 percent of the 2,864,650 square feet of built space are elevator properties, with walkup properties next occupying 15 percent of the space. The bulk, or 42 percent of the built space, is in Brooklyn, with Queens next at 29 percent of the space.

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