Gemini Rosemont signs $34.8M construction loan with East West Bank for 59-unit project in Williamsburg

Gemini Rosemont through the entity 171 North First Street LLC as borrower signed a new construction loan with lender East West Bank valued at $34.8 million for the midblock industrial building at 171 North 1st Street in Williamsburg, Brooklyn.
The deal closed on April 29, 2022 and was recorded on June 6, 2022.
The owner bought the property on March 6, 2020, for $18.2 million. The signatory for Gemini Rosemont was Michael Hernstad. Michael Hernstad is CFO of Gemini Rosemont.

Prior sales and revenue

The 13,860-square-foot property generated revenue of $294,294 or $21 per square foot, according to the most recent income and expense figures.

The property

The 169 North 1st Street parcel has frontage of 200 feet and is 93 feet deep with a total lot size of 13,867 square feet. The lot is irregular. The zoning is M1-2/R6A which allows for up to 2 times floor area ratio (FAR) for manufacturing and up to 3 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $1.3 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the property since September of 2020. In addition, according to city public data, the property has received $5,625 in ECB penalties and $6,855 in OATH penalties in the last year.

Development

On these lots, there is one active new building construction project for a 59-unit, 49,802-square-foot R-2 building. The project was developed by Brian Ferrier with plans filed April 3, 2020 and permitted August 19, 2021.

The neighborhood

In Williamsburg, the bulk, or 35 percent of the 65.1 million square feet of commercial built space are residential elevator buildings, with residential walkup buildings next occupying 19 percent of the space. In sales, Williamsburg has the 9th highest sale turnover among other neighborhoods in the city with $1.4 billion in sales volume in the last two years. For development, Williamsburg is the 6th most active neighborhood among other neighborhoods. It had 5.1 million square feet of commercial and multi-family construction under development in the last two years, which represents 8 percent of the neighborhood’s built space. There was one pre-foreclosure suit filed among other industrial buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of six of the 15 commercial properties representing 65,107 square feet of the 143,407 square feet. The largest owner is John Hermanowski, followed by Michael Gut and then Gemini Rosemont. There are two active new building construction projects totaling 68,782 square feet. The largest is a 59-unit, 49,802-square-foot R-2 building developed by Brian Ferrier with plans filed April 3, 2020 and permitted August 19, 2021. The second largest is a 20-unit, 18,980-square-foot R-2 building developed by Benjamin Stokes with plans filed June 16, 2017 and permitted September 12, 2018.

the majority, or 47 percent of the 160,407 square feet of built space are residential walkup buildings, with residential elevator buildings next occupying 25 percent of the space.

The borrower

The PincusCo database currently indicates that Gemini Rosemont owned at least four commercial properties with 38,434 square feet and a city-determined market value of $13.4 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 36 percent of the 38,434 square feet of built space are industrial properties, with specialty properties next occupying 32 percent of the space. The bulk, or 64 percent of the built space, is in Manhattan, with Brooklyn next at 36 percent of the space.

Surrounding

Within a 400-foot radius of 169 North 1st Street, Pincusco identified seven commercial real estate items of interests occurred over the past 24 months.
Of those seven items, one was in new building development. It was a new building permit issued on May 3, 2021 for a 15,354-square-foot R-2 building with 10 residential units at 661 Driggs Avenue.
Of those seven items, one was for major renovation including a certificate of occupancy change. It was an initial temporary certificate of occupancy issued on September 4, 2020 for the $600,000 renovation of zero-square-foot R-2 building with six residential units at 193 Grand Street.
Of those seven items, two were sales above $5 million totaling $11.2 million. The most recent of the two was DAX Real Estate which bought the 7,039-square-foot, four-unit mixed-use building (K4) on 191 Grand Street for $5.8 million from Howard Hershkovich on June 1, 2022.
Of those seven items, three were loans above $5 million totaling $81.7 million. The most recent of the three was Waterbridge Capital which borrowed $64.1 million from Acadia Realty Trust secured by five condo units in the 5,998-square-foot, 50-unit mixed-use building (RM) on 160-166 North 4th Street on March 28, 2022.

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