Hercules Argyriou signs $43M new construction loan for 70-unit project in Ditmars Steinway

Hercules Argyriou of Mega Contracting through the entity Md45 Developers LLC as borrower signed a new construction loan with lenders Webster Bank, First Horizon Bank, and Bank of Greene County valued at $43 million for two development projects with a total of 70 units planned for 22-61 45th Street and 22-60 46th Street in Ditmars Steinway, Queens.
The first plans were filed on July 10, 2022, calling for construction of a 35-unit, 69,247-square-foot mixed-use building at 22-60 46th Street.
Then Mega on July 14 filed a permit application for construction of a 35-unit, 93,193-square-foot mixed-use building at 22-61 45th Street.

The deal closed on July 21, 2022 and was recorded on August 1, 2022. The prior lender was TD Bank which held debt that had an original loan amount of $9 million. The two properties have 30,000 square feet of built space and 60,016 square feet of additional air rights for a total buildable of 90,024 square feet according to PincusCo analysis of city data. The loan price per built square foot is $1,433 and the price per buildable square foot is $477 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 Hercules Argyriou was Hercules Argyriou. The signatory for Webster Bank, First Horizon Bank, and Bank of Greene County was Jose Arredondo, Christopher J. Alleva, and John Antalek.

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 22-60 46th Street.

Prior sales and revenue

The two properties with a total of 30,000 square feet of built space generated revenue of $437,807 per year or $15 per square foot.

The property

The 22-60 46th Street parcel has frontage of 125 feet and is 100 feet deep with a total lot size of 12,503 square feet. The lot is irregular. The zoning is R6A which allows for up to 3 times floor area ratio (FAR) for residential with inclusionary housing. The city-designated market value for the property in 2022 is $1.2 million.

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 received $7,500 in ECB penalties and $7,500 in OATH penalties in the last year.

The neighborhood

In Ditmars Steinway, the bulk, or 40 percent of the 11.3 million square feet of commercial built space are walkup buildings, with industrial buildings next occupying 25 percent of the space. In sales, Ditmars Steinway has had very little sales volume relative to other neighborhoods with $200.5 million in sales volume in the last two years. For development, Ditmars Steinway has had very little major development activity relative to other neighborhoods.It had 712,170 square feet of commercial and multi-family construction under development in the last two years, which represents 6 percent of the neighborhood’s built space.

The block

On the tax block of 22-60 46th Street, PincusCo has identified the owners of two of the five commercial properties representing 15,000 square feet of the 71,979 square feet. The two identified owners are Md45 Developers LLC and MICHAEL TRACHTENBERG of CHRISTINA.

The majority, or 92 percent of the 32,500 square feet of built space are industrial buildings, with mixed-use buildings next occupying 8 percent of the space.

The borrower

The PincusCo database currently indicates that Hercules Argyriou owned at least two commercial properties in New York City with 129,636 square feet and a city-determined market value of $16.4 million. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 82 percent of the 129,636 square feet of built space are rental condo properties, with retail properties next occupying 18 percent of the space. They are all located in Queens.

Direct link to Acris document. link