EMP Capital signs $110M construction loan with QuadReal for 246-unit project in Prospect Heights

EMP Capital Group through the entity 888 Atlantic Property Owner Lp as borrower signed a new construction loan with lender QuadReal Property Group through the entity Qr Real Estate Capital Reit LLC valued at $110 million for the 246-unit project at 870-888 Atlantic Avenue in Prospect Heights, Brooklyn.

On the lot, there is one active new building construction project for a 246-unit, residential (R-2) building. A smaller project was submitted by Yoel Teitelbaum on April 14, 2022 and permitted May 28, 2022. The plan was filed under job number B00712795.

The deal closed on May 1, 2024 and was recorded on May 13, 2024. The prior lender was Investment Property Exchange Services which held debt that had an original loan amount of $7.5 million.

The owner bought the property on November 10, 2023, for $20 million. The signatory for EMP Capital Group was Elichai Pariente. The signatory for QuadReal Property Group was Paul Stern.

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 two DOB violations, $35,000 in ECB penalties, and $37,430 in OATH penalties in the last year.

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 $209 million in sales volume in the last two years. For development, Prospect Heights has had very little major development activity relative to other neighborhoods.It had 500,180 square feet of commercial and multi-family construction under development in the last two years, which represents 7 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 this tax block, PincusCo has identified the owners of seven of the 23 commercial properties representing 113,447 square feet of the 153,761 square feet. The largest owner is Watermark Capital Group, followed by EMP Capital Group and then David Ebrahimi.
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 borrower

The PincusCo database currently indicates that EMP Capital Group owned at least six commercial properties with seven residential units in New York City with 59,724 square feet and a city-determined market value of $24.2 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 47 percent of the 59,724 square feet of built space are industrial properties, with elevator properties next occupying 31 percent of the space. The bulk, or 69 percent of the built space, is in Brooklyn, with Manhattan next at 31 percent of the space.

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