Directed Capital buys $8.2M note secured by Daten Group mixed-use in East Harlem

Directed Capital through the entity Dcr Mortgage 10 Sub 4, LLC bought a note with an original principal of $8.2 million from Webster Bank secured by Daten Group’s mixed-use building (K2) at 100 East 122nd Street in East Harlem, Manhattan. Directed Capital has purchased at least 13 loans since mid-2020, according to a PincusCo analysis of city records.
The deal closed on June 2, 2023 and was recorded on June 12, 2023. The prior lender was Webster Bank which held debt that had an original loan amount of $8.2 million.
The property has 25,404 square feet of built space according to a PincusCo analysis of city data.
The signatory for the Daten Group loan from Webster Bank was David Ennis.

Prior sales and revenue

The 25,404-square-foot property generated revenue of $1 million or $41 per square foot, according to the most recent income and expense figures.

The property

The mixed-use building in East Harlem has 25,404 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 112 feet and is 100 feet deep with a total lot size of 1,350 square feet. The zoning is M1-6/R10 which allows for up to 10 times floor area ratio (FAR) for manufacturing and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $5.6 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property for the past 24 months. In addition, according to city public data, the property has received one DOB violation 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 East Harlem, The majority, or 51 percent of the 52.3 million square feet of commercial built space are elevator buildings, with specialty buildings next occupying 21 percent of the space. In sales, East Harlem has 2 times the average sales volume among other neighborhoods with $699.9 million in sales volume in the last two years and is the 22nd highest in Manhattan. For development, East Harlem has 2.9 times the average amount of major developments relative to other neighborhoods and is the 10th highest in Manhattan. It had 3 million square feet of commercial and multi-family construction under development in the last two years, which represents 6 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of six of the 22 commercial properties representing 495,170 square feet of the 624,767 square feet. The largest owner is Renaissance Realty Group, followed by Real Estate Equities Corp. and then L+M Development Partners.
On the tax block, there were two new building construction projects totaling 145,993 square feet. The largest is a 134,306 square-foot business (B) building submitted by Real Estate Equities Corporation and filed by Brandon Klein with plans filed December 24, 2020 and permitted September 16, 2021. The second largest is a 15-unit, 11,687 square-foot residential (R-2) building submitted by Joseph Atarien with plans filed June 17, 2019 and permitted June 14, 2022.

The majority, or 81 percent of the 624,767 square feet of built space are elevator buildings, with mixed-use buildings next occupying 7 percent of the space.

The borrower

The PincusCo database currently indicates that Daten Group owned at least two commercial properties with 174 residential units in New York City with 157,578 square feet and a city-determined market value of $17.3 million. (Market value is typically about 50% of actual value.) The portfolio has $144.9 million in debt, with top three lenders as H.I.G. Capital, Mack Real Estate Group, and SL Green Realty respectively. Within the portfolio, all identified are elevator properties. They are all located in Brooklyn.

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