ELH Management signs $29.4M rehab construction loan for three walkup properties in Harlem

ELH Management through the entity ANCP 134 LLC as borrower signed a new construction loan with lender Local Initiatives Support and Neighborhood Restore Housing Development Fund Corporation valued at $29.4 million for three residential walkup properties including the midblock 25-unit residential walkup building at 527 West 134th Street in Harlem, Manhattan, midblock 25-unit residential walkup building at 523 West 134th Street in Harlem, Manhattan, and midblock 19-unit residential walkup building at 505 West 134th Street in Harlem, Manhattan.
The deal closed on March 22, 2022 and was recorded on April 12, 2022.The three properties have 46,960 square feet of built space and 16,772 square feet of additional air rights for a total buildable of 63,775 square feet according to PincusCo analysis of city data. The loan price per built square foot is $626 and the price per buildable square foot is $461 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 ELH Management was Larry Hirschfield. The signatory for Local Initiatives Support and Neighborhood Restore Housing Development Fund Corporation was Salvatore D’Avola. ELH Mgmt is located at the address of owner LLC.

Because multiple properties have been transacted, some of the following sections will follow the property with the largest assessed value, which in this case, is the property on 527 West 134th Street.

Prior sales and revenue

The owners according to the Department of Housing Preservation and Development includes Simone Ross, head officer and Gladys Brito, agent. The business entities are 527 West 134th St and City Of N Y. Out of the three properties, two with a total of 46,960 square feet of built space generated revenue of $753,042 per year.

The property

The 527 West 134th Street parcel has frontage of 48 feet and is 99 feet deep with a total lot size of 4,796 square feet. The zoning is R8A which allows for up to 6.02 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $1.9 million.

Violations and lawsuits

The properties were not involved in any lawsuits or bankruptcies in the past years. In addition, according to city public data, the properties have received $625 in ECB penalties and $5,625 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 $5 million on this tax lot.

The neighborhood

In Harlem, the bulk, or 42 percent of the 99.7 million square feet of commercial built space are residential elevator buildings, with residential walkup buildings next occupying 24 percent of the space. In sales, Harlem has 2.2 times the average sales volume among other neighborhoods with $607.8 million in sales volume in the last two years and is the 20th highest in Manhattan. For development, Harlem has 2.8 times the average amount of major developments relative to other neighborhoods and is the 5th highest in Manhattan. It had 2.6 million square feet of commercial and multi-family construction under development in the last two years, which represents 3 percent of the neighborhood’s built space. There were five pre-foreclosure suit filed among other residential walkup buildings in the past 12 months.

The block

On the tax block of 527 West 134th Street, PincusCo has identified the owners of 24 of the 56 commercial properties representing 501,244 square feet of the 1,123,298 square feet. The largest owner is City of New York, followed by New York City Department of Housing Preservation and Development and then BLDG Management. There is one active new building construction project totaling 22,370 square feet. It is a 28-unit, 22,370-square-foot R-2 building developed by Josef Goodman with plans filed July 13, 2021 and it has not been permitted yet.

The majority, or 51 percent of the 1.2 million square feet of built space are residential walkup buildings, with residential elevator buildings next occupying 21 percent of the space.

The borrower

The PincusCo database currently indicates that ELH Management owned at least 34 commercial properties with 114,587 square feet and a city-determined market value of $13.9 million. (Market value is typically about 50% of actual value.) The portfolio has $34.6 million in debt, with top three lenders as Walker & Dunlop, NYC Housing Development Corporation, and Sterling National Bank respectively. Within the portfolio, the bulk, or 86 percent of the 114,587 square feet of built space are 1-4 family properties, with residential walkup properties next occupying 10 percent of the space. They are all located in Brooklyn.

Surrounding

Within a 400-foot radius of 527 West 134th Street, PincusCo identified five commercial real estate items of interests occurred over the past 24 months.
Of those five items, one was in new building development. It was a new building permit application filed on July 13, 2021 for a 19,071-square-foot R-2 building with 28 residential units at 521 West 134th Street.
Of those five items, two were sales above $5 million totaling $112.9 million. The most recent of the two was Monadnock Development which bought the 14,815-square-foot, 51-unit rental (D2) on 535 West 133rd Street and 37 other properties for $79.3 million from New York City Housing Authority on January 5, 2021.
Of those five items, two were loans above $5 million totaling $300.6 million. The most recent of the two was Arthur Weigold which borrowed $11.5 million from City of New York secured by the 18,905-square-foot, 15-unit rental (C1) on 529 West 135th Street and seven other properties on August 2, 2021.

Direct link to Acris document. link