EMP Capital Group pays $25.6 million for large Prospect Heights development site

EMP Capital Group through the entity 888 Atlantic Avenue LP paid $25.635 million for the development site at 870-878 Atlantic Avenue and at 888 Atlantic Avenue in Prospect Heights, Brooklyn. This parcel is three blocks west of another large site EMP Capital Group is developing at 1034-1042 Atlantic Avenue.

Elie Pariente’s EMP Capital Group purchased the property by acquiring the contract that Yoel Teitelbaum of Y&T Development as original buyer had signed with the property owner, Nikolaos Nikolaidis through the entity Odyssey Realty. The transfer price was $20 million, but a source familiar with the transaction said the EMP Capital Group purchase price was $25.635 million.
The parcel is part of a multi-year land use process paired with 1034-1042 Atlantic Avenue, which EMP Capital Group owns. For much of that time, Yoel Teitelbaum of Y&T Development, as the contract vendee, was the public facing developer for the 870-888 Atlantic Avenue project.

He filed plans in April 2022 for a 17-story building.

The local City Council member, Crystal Hudson, put out a media release in April 2022 following City Council approval of a plan to set aside about 35 percent, or 150, of the units in the two projects for affordable housing. The release said the plans called for 228 total units in 870-888 Atlantic Avenue and 210 total units in 1034-1042 Atlantic Avenue.

EMP Capital Group closed on the purchase of 870-888 Atlantic Avenue on November 10, 2023 and the sale was recorded on November 22, 2023.
The signatory for Nikolaos Nikolaidis was Nikolaos Nikolaidis. The signatory for EMP Capital Group was Elichai Pariente. The contract date was October 3, 2019. The property is subject to a 2021 rezoning and other agreements.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer EMP Capital Group purchased three properties in two transactions for a total of $31 million and has no record it sold any properties over the past 24 months.
The seller Nikolaos Nikolaidis had not purchased any other properties and had not sold any properties over the same time period. The former owners according to the Department of Housing Preservation and Development includes Nikolaos Nikolaidis, head officer and Nikolaos Nikolaides, officer. The business entities are Odyssey Realty Corp and Odyssey Realty Corp. Out of the two properties, one with a total of 13,400 square feet of built space generated revenue of $495,130 per year.

The property

The mixed-use building in Prospect Heights has 13,400 square feet of built space and 137,073 square feet of additional air rights for a total buildable of 150,392 square feet according to a PincusCo analysis of city data. The parcel has frontage of 180 feet and is 100 feet deep with a total lot size of 17,999 square feet. The zoning is C6-3A which allows for up to 6 times floor area ratio (FAR) for commercial and up to 7.52 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $2.5 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties for the past 24 months. In addition, according to city public data, the properties have received $1,900 in OATH penalties in the last year.

Development

On these lots, there is one active new building construction project for a 193-unit, 169,561 square-foot R-2 building. The project was submitted by Yoel Teitelbaum and filed by Yoel Teitelbaum with plans filed April 14, 2022 and permitted May 28, 2022.

The neighborhood

In Prospect Heights, The bulk, or 49 percent of the 7 million square feet of commercial built space are elevator buildings, with walkup buildings next occupying 28 percent of the space. In sales, Prospect Heights has had very little sales volume relative to other neighborhoods with $161.4 million in sales volume in the last two years. For development, Prospect Heights has near average amount of major developments among other neighborhoods and is the 18th highest in Brooklyn. It had 882,320 square feet of commercial and multi-family construction under development in the last two years, which represents 13 percent of the neighborhood’s built space. There were two pre-foreclosure suit filed among other mixed-use buildings in the past 12 months.

The block

On the tax block of 870-878 Atlantic Avenue, PincusCo has identified the owners of five of the 23 commercial properties representing 100,047 square feet of the 153,761 square feet. The largest owner is Watermark Capital Group, followed by David Ebrahimi and then Cubesmart.
On the tax block, there were five new building construction projects totaling 510,259 square feet. The largest is a 267-unit, 237,197 square-foot residential (R-2) building submitted by Vanderbilt Atlantic Holdings and filed by Tom Li with plans filed January 11, 2022 and permitted June 8, 2022. The second largest is a 193-unit, 169,561 square-foot residential (R-2) building submitted by Yoel Teitelbaum and filed by Yoel Teitelbaum with plans filed April 14, 2022 and permitted May 28, 2022.

The majority, or 59 percent of the 153,761 square feet of built space are industrial buildings, with mixed-use buildings next occupying 19 percent of the space.

The buyer

The PincusCo database currently indicates that Emp Capital Group owned at least four commercial properties with seven residential units in New York City with 46,324 square feet and a city-determined market value of $21.5 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 60 percent of the 46,324 square feet of built space are industrial properties, with elevator properties next occupying 40 percent of the space. The bulk, or 60 percent of the built space, is in Brooklyn, with Manhattan next at 40 percent of the space.

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