Churchill buys $40M note secured by its own 33-unit rental in Lenox Hill

Churchill Real Estate Holdings through the entity 809 Madison Lender LLC bought a note with an original principal of $40 million from prior lenders Partners Enterprise Capital and Keysite Capital Partners secured by Churchill Real Estate Holdings’s 33-unit residential elevator building (D6) at 30 East 68th Street in Lenox Hill, Manhattan.
The deal closed on August 17, 2022 and was recorded on October 4, 2022. The prior lender was Partners Enterprise Capital and Keysite Capital Partners which held debt that had an original loan amount of $40 million. The property has 41,371 square feet of built space according to PincusCo analysis of city data.
The owner bought the property on August 14, 2019, for $56.8 million. The note buyer is Churchill Real Estate and identifies the LLC’s ceo as Robert Dakis, general counsel at Churchill. The prior lender was Keysite, which according to its website, “develops long-term relationships, providing fixed and floating-rate subordinate mortgages and mezzanine loans on multiple property types in New York City.” Partners Enterprise Capital formed Keysite Capital Partners as a lending vehicle.

Prior sales and revenue

The owners according to the Department of Housing Preservation and Development includes Sorabh Maheshwari, head officer and Angel Diaz, site manager. The business entities are Livingston Management Services and Churchill 809 Madison Llc. The 41,371-square-foot property generated revenue of $3.5 million or $84 per square foot, according to the most recent income and expense figures.

The property

The 30 East 68th Street parcel has frontage of 40 feet and is 95 feet deep with a total lot size of 3,840 square feet. The zoning is C5-1 which allows for up to 4 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The property is in the Upper East Side Historic District. The city-designated market value for the property in 2022 is $20.7 million. The most recent loan totaled $40 million and was provided by Keysite Capital Partners on August 14, 2019.

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 17 housing violations and $1,000 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 block

On this tax block, PincusCo has identified the owners of nine of the 32 commercial properties representing 160,070 square feet of the 391,881 square feet. The largest owner is Black Spruce Management, followed by Churchill Real Estate Holdings and then Tatiana Botton.
There are no active new building construction projects on this tax block.

The majority, or 45 percent of the 371,929 square feet of built space are elevator buildings, with office buildings next occupying 17 percent of the space.

The borrower

The PincusCo database currently indicates that Churchill Real Estate Holdings owned at least 11 commercial properties in New York City with 250,330 square feet and a city-determined market value of $83.3 million. (Market value is typically about 50% of actual value.) The portfolio has $161.6 million in debt, with top three lenders as Square Mile Capital Management, Keysite Capital Partners, and Silver Point Capital respectively. Within the portfolio, the bulk, or 24 percent of the 250,330 square feet of built space are walkup properties, with elevator properties next occupying 23 percent of the space. They are all located in Manhattan.

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