Douglaston signs $500M refi with Goldman, Wells Fargo for 937-unit rental in Chelsea

Douglaston Development through the entity DD West 29th LLC as borrower signed a refi loan with lender Goldman Sachs and Wells Fargo valued at $500 million for the 937-unit residential elevator building (D7) at 613 West 29th Street in Chelsea, Manhattan.
The deal closed on July 26, 2024 and was recorded on July 30, 2024. The prior lender was HSBC Bank which held debt that had an original loan amount of $415 million.

The property has 940,914 square feet of built space according to a PincusCo analysis of city data. The loan price per built square foot is $531 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 Goldman Sachs and Wells Fargo was Steve Pack and Jeffrey L. Cirillo. Douglaston Development developed this building as a tenanted under a ground lease with the company Valeray Real Estate.

Prior sales and revenue

The owners according to the Department of Housing Preservation and Development includes Michael Kessler, head officer and Steven Charno, lessee. The business entities are Dd West 29 Th Llc, Clinton Management Llc., and Dd West 29th Llc.

The property

The residential elevator building with 937 residential units in Chelsea has 940,914 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 525 feet and is 197 feet deep with a total lot size of 61,718 square feet. The zoning is C6-4X which allows for up to 10 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $225.7 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 three housing violations and $39,485 in OATH penalties in the last year.

Development

On the lot, there was a new building construction project, 121188918, for a 938-unit, 740,252 square-foot R-2 building. The project was submitted by Douglaston Development and filed by Steven Charno with plans filed September 11, 2018 and permitted November 27, 2019.

The block

On this tax block, PincusCo has identified the owners of three of the three commercial properties representing 1,261,628 square feet of the 1,261,628 square feet. The largest owner is Douglaston Development, followed by Georgetown Company and then Lalezarian Properties.
On the tax block, there were two new building construction projects totaling 947,619 square feet. The largest is a 938-unit, 740,252 square-foot residential (R-2) building submitted by Douglaston Development and filed by Steven Charno with plans filed September 11, 2018 and permitted July 16, 2019. The second largest is a 277-unit, 207,367 square-foot residential (R-2) building submitted by Lalezarian Properties and filed by Kevin Lalezarian with plans filed February 28, 2019 and permitted January 5, 2022.

The majority, or 99 percent of the 1.3 million square feet of built space are elevator buildings, with industrial buildings next occupying 1 percent of the space.

The borrower

The PincusCo database currently indicates that Douglaston Development owned at least nine commercial properties with 2,277 residential units in New York City with 2,347,961 square feet and a city-determined market value of $618 million. (Market value is typically about 50% of actual value.) The portfolio has $612.7 million in debt, with top three lenders as MSD Partners, NYC Housing Development Corporation, and NYS Housing Finance Agency respectively. Within the portfolio, the bulk, or 99 percent of the 2,347,961 square feet of built space are elevator properties, with retail properties next occupying 1 percent of the space. The bulk, or 48 percent of the built space, is in Brooklyn, with Manhattan next at 46 percent of the space.

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