George Rigas signs $15.6M construction loan for 77-unit project in Coney Island

George Rigas through the entity 2909 West 17th Street, LLC as borrower signed a new construction loan with lender Provident Bank valued at $15.6 million for two properties including the midblock specialty building at 2913 West 17th Street in Coney Island, Brooklyn and the midblock development building at 1622 Mermaid Avenue in Coney Island, Brooklyn.
The deal closed on April 12, 2022 and was recorded on April 22, 2022. The prior lender was Signature Bank which held debt that had an original loan amount of $19.5 million, but that loan was satisfied in 2018. The two properties have 60 square feet of built space and 70,979 square feet of additional air rights for a total buildable of 71,075 square feet according to PincusCo analysis of city data. The loan price per buildable square foot is $220 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 George Rigas was George Rigas. Rigas filed building plans for a 77-unit, 66,664-square-foot R-2 building in October 2021.

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 1622 Mermaid Avenue.

The property

The 1622 Mermaid Avenue parcel has frontage of 58 feet and is 100 feet deep with a total lot size of 5,890 square feet. The zoning is R7A which allows for up to 4 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $283,000.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties since September of 2020. In addition, according to city public data, the properties have not received any significant violations in the last year.

Development

On these lots, there is one active new building construction project for a 77-unit, 66,664-square-foot R-2 building. The project was developed by George Rigas with plans filed October 12, 2021 and it has not been permitted yet.

The neighborhood

In Coney Island, the majority, or 70 percent of the 25.1 million square feet of commercial built space are residential elevator buildings, with specialty buildings next occupying 10 percent of the space. In sales, Coney Island has had very little sales volume relative to other neighborhoods with $64.9 million in sales volume in the last two years. For development, Coney Island has 2.2 times the average amount of major developments relative to other neighborhoods and is the 11th highest in Brooklyn. It had 2 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.

The block

On the tax block of 1622 Mermaid Avenue, PincusCo has identified the owners of one of the 13 commercial properties representing zero square feet of the 52,113 square feet. The identified owner is BFC Partners. There are two active new building construction projects totaling 359,950 square feet. The largest is a 77-unit, 66,664-square-foot R-2 building developed by George Rigas with plans filed October 12, 2021 and it has not been permitted yet. The second largest is a 376-unit, 293,286-square-foot R-2 building developed by Joseph Ferrara with plans filed March 4, 2020 and permitted August 13, 2021.

The majority, or 78 percent of the 52,113 square feet of built space are residential walkup buildings, with mixed-use buildings next occupying 22 percent of the space.

The borrower

The PincusCo database currently indicates that George Rigas owned at least one commercial property with 71,644 square feet and a city-determined market value of $15.7 million. (Market value is typically about 50% of actual value.) The portfolio consists of at least a single residential elevator property. It is located in Brooklyn.

Surrounding

Within a 400-foot radius of 1622 Mermaid Avenue, PincusCo identified four commercial real estate items of interests occurred over the past 24 months.
Of those four items, two were in new building development. There were two new building permits. The most recent of these two items was a permit on March 15, 2022 for a 107,517-square-foot R-2 building with 139 residential units at 2919 W 16th St.
Of those four items, two were loans above $5 million totaling $154 million. The most recent of the two was BFC Partners which borrowed $139 million from NYC Housing Development Corporation secured by the 0-square-foot industrial (G6) on 1607 Surf Avenue on January 7, 2022.

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