Faraj Srour, Joseph Stavrach sign $101.5M refi with Bank of Montreal, Citibank for Manhattan office

Faraj Srour and Joseph Stavrach through the entity 2 West 46 Borrower II LLC as borrower signed a refi loan with lender Bank of Montreal and Citibank valued at $101.5 million for two office properties including the office building (O4) at 363 Lexington Avenue in Grand Central, and the office building (O6) at 2 West 46th Street in Midtown West, Manhattan.
The deal closed on September 28, 2023 and was recorded on October 3, 2023. The prior lender was Series 2013-C15 which held debt that had an original loan amount of $73.5 million.
The two properties have 237,049 square feet of built space according to a PincusCo analysis of city data. The loan price per built square foot is $427 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 Faraj Srour and Joseph Stavrach was Faraj Srour and Joseph Stavrach. The signatory for Bank of Montreal and Citibank was Michael Birajiclian and Ana Rosu Marmann.

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 363 Lexington Avenue.

The property

The parcel has frontage of 118 feet and is 92 feet deep with a total lot size of 10,418 square feet. The lot is irregular. The zoning is C5-3 which allows for up to 15 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $49.1 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 six DOB violations, $631,000 in ECB penalties, and $16,410 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 neighborhood

In Grand Central, The majority, or 83 percent of the 43.5 million square feet of commercial built space are office buildings, with hotel buildings next occupying 8 percent of the space. In sales, Grand Central has 2.5 times the average sales volume among other neighborhoods with $895.8 million in sales volume in the last two years and is the 15th highest in Manhattan. For development, Grand Central has 2.3 times the average amount of major developments relative to other neighborhoods and is the 11th highest in Manhattan. It had 2.2 million square feet of commercial and multi-family construction under development in the last two years, which represents 5 percent of the neighborhood’s built space. There were two pre-foreclosure suit filed among other office buildings in the past 12 months.

The block

On the tax block of 363 Lexington Avenue, PincusCo has identified the owners of three of the seven commercial properties representing 695,676 square feet of the 3,114,083 square feet. The largest owner is Terra Capital Partners, followed by Savanna and then Atco Properties & Management.
There are no active new building construction projects on this tax block.

All properties are office.

The borrower

The PincusCo database currently indicates that Faraj Srour owned at least 11 commercial properties in New York City with 323,051 square feet and a city-determined market value of $57.9 million. (Market value is typically about 50% of actual value.) The portfolio has $98.9 million in debt, with top three lenders as New York Community Bank, Sterling National Bank, and BCB Community Bank respectively. Within the portfolio, the bulk, or 56 percent of the 323,051 square feet of built space are office properties, with retail properties next occupying 38 percent of the space. The bulk, or 35 percent of the built space, is in Manhattan, with Brooklyn next at 24 percent of the space.

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