Dylan Bell pays $3.1M to Sterling Town Equities for office in Bed Stuy

Dylan Bell through the entity Rudiger Holdings LLC paid $3.1 million to Sterling Town Equities through the entity Herkimer Usa LLC for midblock office building at 11 Herkimer Place in Bed Stuy, Brooklyn.
The deal closed on April 25, 2022 and was recorded on May 5, 2022. The property has 7,529 square feet of built space according to PincusCo analysis of city data. The sale price per built square foot is $411 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 April 7, 2014, for $750,000. The signatory for Sterling Town Equities was Rosemary Hayden. The signatory for Dylan Bell was Daniel Chitrik. Yosef Ariel, founder of Sterling Town Equities signed on the previous mortgage for the property.

Prior sales and revenue

Prior to this transaction, PincusCo has no record that the buyer Daniel Chitrik had purchased any other properties and has no record it sold any properties over the past 24 months.
The seller Sterling Town Equities had not purchased any other properties and had not sold any properties over the same time period. The 7,529-square-foot property generated revenue of $238,970 or $32 per square foot, according to the most recent income and expense figures.

The property

The 11 Herkimer Place parcel has frontage of 40 feet and is 86 feet deep with a total lot size of 4,115 square feet. The lot is irregular. The zoning is M1-1 which allows for up to 1 times floor area ratio (FAR) for manufacturing 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 not received any significant violations in the last year.

Development

For the tax lot building, it received its initial alteration certificate of occupancy on November 27, 2020. 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 Bed Stuy, the bulk, or 38 percent of the 92.5 million square feet of commercial built space are 1-4 family buildings, with residential elevator buildings next occupying 20 percent of the space. In sales, Bed Stuy has 1.5 times the average sales volume among other neighborhoods with $417.3 million in sales volume in the last two years and is the 6th highest in Brooklyn. For development, Bed Stuy is the 8th most active neighborhood among other neighborhoods. It had 4.3 million square feet of commercial and multi-family construction under development in the last two years, which represents 5 percent of the neighborhood’s built space. There were three pre-foreclosure suit filed among other office buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of 12 of the 26 commercial properties representing 77,671 square feet of the 176,755 square feet. The largest owner is 1926 Elsmere, Inc, followed by Stephan Tchorbajian and then Scott Rosenthal. There is one active new building construction project totaling 3,647 square feet. It is a 3,647-square-foot A-2 building developed by Marcello Porcelli with plans filed May 22, 2014 and it has not been permitted yet.

The majority, or 21 percent of the 291,517 square feet of built space are 1-4 family buildings, with industrial buildings next occupying 16 percent of the space.

The seller

The PincusCo database, which is incomplete, currently indicates that Sterling Town Equities owned at least four commercial properties with 51,474 square feet and a city-determined market value of $11.5 million. (Market value is typically about 50% of actual value.) The portfolio has $58.1 million in debt, borrowed from Bank Hapoalim and Morgan Stanley. Within the portfolio, the bulk, or 57 percent of the 51,474 square feet of built space are residential elevator properties, with development properties next occupying 27 percent of the space. They are all located in Brooklyn.

Surrounding

Within a 400-foot radius of 11 Herkimer Place, PincusCo identified three commercial real estate items of interests occurred over the past 24 months.
Of those three items, one was for major renovation including a certificate of occupancy change. It was an initial temporary certificate of occupancy issued on February 5, 2021 for the $3.1 million renovation of 90,991-square-foot S-1 building with no residential units at 1260 Atlantic Avenue.
One of those three items was a sale which 1926 Elsmere, Inc bought the industrial (G7) parcel on 1305 Bedford Avenue and two other properties for $12.4 million from LargaVista Companies on June 25, 2021.
One of those three items was a loan which Bawabeh Brothers borrowed $56 million from Signature Bank secured by the 22,505-square-foot, two-unit retail building (K1) on 1212 Fulton Street and 25 other properties on December 13, 2021.

UPDATE: The buyer entity is managed by Dylan Bell, and Daniel Chitrik is a partner. A prior version of the post only identified Chitrik. The headline was changed to Dylan Bell.

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