Exact Capital signs $28.4M construction loan for 31-unit project in Harlem

Exact Capital through the entity Northern Manhattan Equities III LLC as borrower signed a new construction loan with lender Sterling National Bank valued at $28.4 million for two properties including the midblock 31-unit development at 207-209 West 140th Street in Harlem, Manhattan.
The deal closed on December 22, 2021 and was recorded on March 10, 2022. The prior lender was Merchants Bank of Indiana which held debt that had an original loan amount of $25.4 million.The two properties have zero square feet of built space and 49,326 square feet of additional air rights for a total buildable of 49,326 square feet according to PincusCo analysis of city data. The loan price per buildable square foot is $576 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 Exact Capital was Craig Livingston. The signatory for Sterling National Bank was Shelia Martin.

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 207-209 West 140th Street.

The property

The 207-209 West 140th Street parcel has frontage of 36 feet and is 99 feet deep with a total lot size of 5,596 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 $1.1 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 $750 in OATH penalties in the last year.

Development

On these lots, there is one active new building construction project for a 31-unit, 52,489-square-foot R-2 building. The project was developed by Exact Capital with plans filed August 13, 2019 and it has not been permitted yet.

The neighborhood

In Harlem, the bulk, or 42 percent of the 99.7 million square feet of 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.

The block

On the tax block of 207-209 West 140th Street, PincusCo has identified the owners of 12 of the 36 commercial properties representing 228,588 square feet of the 670,410 square feet. The largest owner is Lemor Development Group, followed by Prana Investments and then West Harlem Group Associates. There are two active new building construction projects totaling 40,597 square feet. The largest is a 20-unit, 21,620-square-foot R-2 building developed by Kenneth Morrison with plans filed December 2, 2015 and it has not been permitted yet. The second largest is a 21-unit, 18,977-square-foot R-2 building developed by Michael Callaghan with plans filed August 28, 2019 and it has not been permitted yet.

The majority, or 51 percent of the 468,456 square feet of built space are residential elevator buildings, with residential walkup buildings next occupying 46 percent of the space.

Surrounding

Within a 400-foot radius of 207-209 West 140th Street, Pincusco identified six commercial real estate items of interests occurred over the past 24 months.
Of those six items, three were sales above $5 million totaling $106.5 million. The most recent of the three was Lemor Development Group which bought the 31,410-square-foot, 31-unit rental (D1) on 233 West 140th Street and six other properties for $15.7 million from National Equity Fund on January 21, 2021.
Of those six items, three were loans above $5 million totaling $308.2 million. The most recent of the three was Monadnock Development which borrowed $289.1 million from New York City Housing Authority secured by the 14,815-square-foot, 14-unit rental (C4) on 2401 Adam C Powell Blvd and 38 other properties on January 5, 2021.

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