Fannie Mae acquires Zalmen Wagschal Bushwick walkups in bankruptcy for $6.2M

Lender Fannie Mae acquired the six-unit walkups (C2) at 867 and 871 Knickerbocker Avenue in Bushwick, Brooklyn for $6.2 million, through a bankruptcy filed by Zalmen Wagschal through the entity 867-871 Knickerbocker LLC, that owned the properties.
The transfer closed on April 7, 2025 and was recorded on April 9, 2025. The two properties have 9,750 square feet of built space and 2,400 square feet of additional air rights for a total buildable of 12,150 square feet according to a PincusCo analysis of city data. The sale price per built square foot is $632 and the price per buildable square foot is $507 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 Zalmen Wagschal was Zalmen Wagschal. The signatory for Fannie Mae was Roy Miller. The contract date was February 24, 2025. Fannie Mae won the properties through a credit bid in the bankruptcy filed in the Eastern District of New York, 24-42979-nhl.

Prior sales and revenue

Prior to this transaction, PincusCo has records that the buyer Fannie Mae purchased one property in one transaction for a total of $2 million and has no record it sold any properties over the past 24 months.
The seller Zalmen Wagschal had not purchased any other properties and sold five properties in two transactions for a total of $6.1 million over the same time period. The former owner according to the Department of Housing Preservation and Development is Zach Spira, head officer. The business entity is 867-871 Knickerbocker Llc. Out of the two properties, one with a total of 9,750 square feet of built space generated revenue of $85,849 per year.

Violations and lawsuits

The properties were involved in one bankruptcy over the past two years. The bankruptcy was filed on July 18, 2024, by Zalmen Waschal and Moshe Deutsch citing assets of $4.7 million. In addition, according to city public data, the properties have received 30 housing violations and $1,655 in OATH penalties in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The block

On the tax block of 871 Knickerbocker Avenue, PincusCo has identified the owners of five of the 18 commercial properties representing 24,738 square feet of the 78,546 square feet. The largest owner is Zalmen Waschal, followed by David Behin and then Yolanda Baez.
There are no active new building construction projects on this tax block.

The majority, or 75 percent of the 78,546 square feet of built space are walkup buildings, with mixed-use buildings next occupying 25 percent of the space.

The seller

The PincusCo database currently indicates that Zalmen Wagschal owned at least nine commercial properties with 67 residential units in New York City with 66,883 square feet and a city-determined market value of $9.3 million. (Market value is typically about 50% of actual value.) The portfolio has $59.1 million in debt, with top three lenders as Citibank, Extensia Financial, and Hanover Community Bank respectively. Within the portfolio, the bulk, or 73 percent of the 66,883 square feet of built space are walkup properties, with hotel properties next occupying 24 percent of the space. They are all located in Brooklyn.

The buyer

The PincusCo database currently indicates that Fannie Mae owned at least one commercial property with 10 residential units in New York City with 10,425 square feet and a city-determined market value of $1.8 million. (Market value is typically about 50% of actual value.) The portfolio consists of at least a single walkup property. It is located in Bronx.

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