Embattled developer HFZ Capital signs $22.8M condo inventory loan with Allied Capital at The Bryant

HFZ Capital Group which as a company and through its owner Ziel Feldman is battling lenders, contractors, investors and partners on multiple fronts, nonetheless through the entity 20 West 40 Bryant Park Owner LLC as borrower signed a condo inventory loan with lender Allied Capital and Development through the entity Bryant Park Funding 100, LLC valued at $22.8 million for 14 condo units including the property at 16 West 40th Street in Grand Central, Manhattan.
The deal closed on May 27, 2022 and was recorded on June 28, 2022. The prior lender was Banco Inbursa which held debt that had an original loan amount of $33 million. The 14 properties have 28,863 square feet of built space according to PincusCo analysis of city data. The loan price per built square foot is $789 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 HFZ Capital Group was Ziel Feldman. Allied Capital and Development is located at the same address as lender LLC.

Nicholas Mastroianni II leads Allied Capital, and also founded the EB-5 investment fund U.S. Immigration Fund, which directed investors in this project. EB-5 investors sued Feldman in relation to this project, and also sought to start an arbitration proceeding related to their investments in this project, and Feldman successfully petitioned the court to reject that attempt, with an order blocking the arbitration handed down June 22, 2022.

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 16 West 40th Street.

The property

The 16 West 40th Street parcel has a total lot size of 4,202 square feet. The city-designated market value for the property in 2022 is $1.7 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties since September of 2020. In addition, according to city public data, the properties have not received any significant violations in the last year.

Development

For the tax lot buildings, one out of the 14 buildings received a initial certificate of occupancy in the last ten years. On these lots, there is one active new building construction project for a 283-unit, 824,216-square-foot R-2 building. The project was developed by John Simonlacaj with plans filed January 9, 2014 and permitted June 23, 2016. On one of the tax lots, there was a condominium project filed with the address 16 West 40th Street and the name Bryant Park South Condominium on September 30, 2014. The principals of the sponsor, HFZ BRYANT PARK OWNER LLC, was Ziel Feldman.

The block

On the tax block of 16 West 40th Street, PincusCo has identified the owners of seven of the 39 commercial properties representing 128,459 square feet of the 2,280,550 square feet. The largest owner is John H.K. Belt, followed by Kendor Development and then Allied Partners. There are three active new building construction projects totaling 880,829 square feet. The largest is a 283-unit, 824,216-square-foot R-2 building developed by John Simonlacaj with plans filed January 9, 2014 and permitted June 23, 2016. The second largest is a 62-unit, 54,367-square-foot R-2 building developed by Leonard Wilf with plans filed December 17, 2014 and permitted July 28, 2016.

the majority, or 84 percent of the 2.2 million square feet of built space are office buildings, with hotel buildings next occupying 6 percent of the space.

Surrounding

Within a 400-foot radius of 16 West 40th Street, Pincusco identified four commercial real estate items of interests occurred over the past 24 months.
Of those four items, three were sales above $5 million totaling $330.1 million. The most recent of the three was RFR Holding which bought the 220,413-square-foot, 68-unit office building (O4) on 473 5th Avenue for $291 million from Nuveen on May 24, 2022.
One of those four items was a loan which RFR Holding borrowed $180 million from Citibank secured by the 220,413-square-foot, 68-unit office building (O4) on 473 5th Avenue on May 24, 2022.

Direct link to Acris document. link