Elmo Realty signs $26M construction loan with Metropolitan Commercial for development in Harlem
Elmo Realty through the entity Empire Development Fund 2 LLC as borrower signed a new construction loan with lender Metropolitan Commercial Bank valued at $26 million for the development building (V1) at 2535 Fredrick Douglass Boulevard in Harlem, Manhattan.
The deal closed on March 13, 2023 and was recorded on April 7, 2023. The prior lender was JY Capital Group which held debt that had an original loan amount of $220,000.
The owner bought the property on December 11, 2015, for $1.5 million. The signatory for Elmo Realty was Saba Vahdat.
The property
The parcel has frontage of 99 feet and is 100 feet deep with a total lot size of 9,992 square feet. The zoning is R7-2 which allows for up to 3.44 times floor area ratio (FAR) for residential. The city-designated market value for the property in 2022 is $2.3 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 DOB violations, $54,000 in ECB penalties, and $54,030 in OATH penalties in the last year.
Development
On the lot, there are two active new building construction projects and major alteration projects with initial costs more than $5 million, totaling 122,610 square feet. The largest is a new building project for a 22-unit, 61,642 square-foot R-2 building submitted by Saba Vadhat with plans filed October 8, 2020 and it has not been permitted yet. The second largest is a new building project for a 60,968 square-foot R-2 building submitted by Mamadou Cedric Davis with plans filed November 8, 2022 and it has not been permitted yet.
The neighborhood
In Harlem, The bulk, or 43 percent of the 81 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 30 percent of the space. In sales, Harlem has 2.2 times the average sales volume among other neighborhoods with $771.5 million in sales volume in the last two years and is the 20th highest in Manhattan. For development, Harlem has 3.8 times the average amount of major developments relative to other neighborhoods and is the 7th highest in Manhattan. It had 3.9 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.
The block
On this tax block, PincusCo has identified the owners of two of the 14 commercial properties representing 125,568 square feet of the 152,857 square feet. The two identified owners are NYC Department Of Education and Northeastern Conference of Seventh-Day Adventists.
On the tax block, there were three new building construction projects totaling 132,799 square feet. The largest is a 22-unit, 61,642 square-foot residential (R-2) building submitted by Saba Vadhat with plans filed October 8, 2020 and it has not been permitted yet. The second largest is a 60,968 square-foot residential (R-2) building submitted by Mamadou Cedric Davis with plans filed November 8, 2022 and it has not been permitted yet.
The majority, or 82 percent of the 152,857 square feet of built space are specialty buildings, with walkup buildings next occupying 12 percent of the space.
The borrower
The PincusCo database currently indicates that Elmo Realty owned at least two commercial properties with 11 residential units in New York City with 50,506 square feet and a city-determined market value of None. (Market value is typically about 50% of actual value.) The portfolio has $14.4 million in debt, borrowed from Webster Bank and PIMCO. Within the portfolio, the bulk, or 82 percent of the 50,506 square feet of built space are M1 properties, with walkup properties next occupying 18 percent of the space. The bulk, or 82 percent of the built space, is in Brooklyn, with Manhattan next at 18 percent of the space.
Direct link to Acris document. link