Delshah Capital sells mixed-use in Bedford Stuyvesant to Joel Lefkowitz for $3.1M

Joel Lefkowitz through the entity 1038 Bedford LLC paid $3.1 million to Michael Shah’s Delshah Capital through the entity DS Brooklyn Portfolio Owner LLC for the four-unit mixed-use building (S4) at 1038 Bedford Avenue in Bedford Stuyvesant, Brooklyn. The expected use is cash flowing.
The deal closed on October 9, 2024 and was recorded on November 6, 2024. The property has 5,400 square feet of built space and 992 square feet of additional air rights for a total buildable of 6,400 square feet according to a PincusCo analysis of city data. The sale price per built square foot is $583 and the price per buildable square foot is $492 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 September 21, 2018, for $2.9 million. The signatory for Delshah Capital was Michael Shah and Yoni Hadar. The contract date was October 9, 2024.

Prior sales and revenue

Prior to this transaction, PincusCo has no record that the buyer Joel Lefkowitz had purchased any other properties and has no record it sold any properties over the past 24 months.
The seller Delshah Capital had not purchased any other properties and sold eight properties in eight transactions for a total of $113.3 million over the same time period. The former owners according to the Department of Housing Preservation and Development includes Michael Shah, head officer and Arnaldo Alvarado, agent. The business entities are DS Brooklyn Portfolio Owner Llc and Ds Brooklyn Portfolio Owner Llc.

The property

The mixed-use building with 4 residential units in Bedford Stuyvesant has 5,400 square feet of built space and 992 square feet of additional air rights for a total buildable of 6,400 square feet according to a PincusCo analysis of city data. The parcel has frontage of 20 feet and is 80 feet deep with a total lot size of 1,600 square feet. The zoning is R7A which allows for up to 4 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $560,000. The most recent loan totaled $70 million and was provided by Signature Bank on October 20, 2022.

Violations and lawsuits

The property was involved in one lawsuit and zero bankruptcies over the past two years. The suit, 655759/2023, was a $3.1 million money judgment concerning a contract filed on November 17, 2023, by Delshah Capital against Bridge Asset Management. In addition, according to city public data, the property has received $1,580 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 $1 million on this tax lot.

The neighborhood

In Bedford Stuyvesant, The bulk, or 35 percent of the 54.8 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 29 percent of the space. In sales, Bedford Stuyvesant has the 8th highest sale turnover among other neighborhoods in the city with $1.1 billion in sales volume in the last two years. For development, Bedford Stuyvesant has 2.6 times the average amount of major developments relative to other neighborhoods and is the 5th highest in Brooklyn. It had 2.8 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 mixed-use buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of eight of the 15 commercial properties representing 111,448 square feet of the 130,570 square feet. The largest owner is Loketch Group, followed by Abraham Friedrich and then All Year Management.
There are no active new building construction projects on this tax block.

The majority, or 56 percent of the 130,570 square feet of built space are elevator buildings, with mixed-use buildings next occupying 23 percent of the space.

The seller

The PincusCo database currently indicates that Delshah Capital owned at least 38 commercial properties with 768 residential units in New York City with 844,367 square feet and a city-determined market value of $177.9 million. (Market value is typically about 50% of actual value.) The portfolio has $572.7 million in debt, with top three lenders as Arbor Realty Trust, Apollo Global Management, and Signature Bank respectively. Within the portfolio, the bulk, or 51 percent of the 844,367 square feet of built space are elevator properties, with walkup properties next occupying 34 percent of the space. The bulk, or 52 percent of the built space, is in Brooklyn, with Manhattan next at 48 percent of the space.

The buyer

The PincusCo database currently indicates that Joel Lefkowitz owned at least eight commercial properties with 62 residential units in New York City with 43,390 square feet and a city-determined market value of $9 million. (Market value is typically about 50% of actual value.) The portfolio has $47.8 million in debt, borrowed from Berkadia Commercial Mortgage and Signature Bank. Within the portfolio, the bulk, or 93 percent of the 43,390 square feet of built space are walkup properties, with C3 properties next occupying 7 percent of the space. They are all located in Brooklyn.

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