EJS Group, Hope Street sign $83.15M construction loan with Bank OZK in Bedford Stuyvesant
UPDATED 4:30 p.m., December 14, 2023: EJS Group and Hope Street Capital through the entity Fulton Property Owner LLC as borrower signed a construction loan with lender Bank OZK valued at $83.15 million for the 240-unit project at 12 Halsey Street in Bedford Stuyvesant, Brooklyn.
The developers plan an approximately 240-unit project with about 230,000 square feet spread over three buildings, according to a media release. The financing is composed of $83.15 in a senior loan and $25 million in a mezzanine loan, totaling $108.15 million in total.
The deal closed on December 7, 2023 and was recorded on December 13, 2023. The prior lender was ACRES Capital which held debt that had an original loan amount of $20 million.
The owner bought the property on March 2, 2022, for $33.6 million. The signatory for EJS Group was Theodore Zellie Segal. The signatory for Bank OZK was Cliffton Hill.
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 DOB violations, $52,500 in ECB penalties, and $62,595 in OATH penalties in the last year.
The neighborhood
In Bedford Stuyvesant, The bulk, or 35 percent of the 54.7 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 3.5 times the average sales volume among other neighborhoods with $1.2 billion in sales volume in the last two years and is the 3rd highest in Brooklyn. For development, Bedford Stuyvesant has 2.8 times the average amount of major developments relative to other neighborhoods and is the 4th 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 two pre-foreclosure suit filed among other development buildings in the past 12 months.
The block
On this tax block, PincusCo has identified the owners of 10 of the 27 commercial properties representing 53,353 square feet of the 127,578 square feet. The largest owner is Joinal Abedin, followed by Infinity Real Estate and then Hope Street Capital.
On the tax block, there were three new building construction projects totaling 206,015 square feet. The largest is a 336-unit, 163,708 square-foot hotel/dormitory/shelter (R-1) building submitted by Robert Pinkas and filed by Robert Pinkas with plans filed September 16, 2019 and permitted April 17, 2023. The second largest is a 31-unit, 23,081 square-foot residential (R-2) building submitted by Baruch Guttman with plans filed January 10, 2020 and permitted June 9, 2022.
The majority, or 65 percent of the 127,578 square feet of built space are mixed-use buildings, with retail buildings next occupying 25 percent of the space.
The borrower
The PincusCo database currently indicates that EJS Group owned at least four commercial properties in New York City with 0.0 square feet and a city-determined market value of $9.2 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 0 percent of the 0.0 square feet of built space are V1 properties, with development properties next occupying 0 percent of the space.
Correction: A prior version of this post gave incorrect information related to the development project. The information has been updated with information provided by a media release from the developer. In addition, we have added information related to a $25 million mezzanine loan.
Direct link to Acris document. link