HousingPlus, Spatial Equity Co. pay $5M for site, get $57.8M construction loan from city, state in East New York

HousingPlus and Spatial Equity Co. through the entity Shepherd Glenmore Housing Development Fund Corporation purchased two parcels for $5 million, and obtained financing for a new construction loan with lender NYS Housing Finance Agency and NYC Department of Housing Preservation and Development valued at $57.8 million for an affordable housing development site encompassing four properties including the industrial building (G9) at 355 Shepherd Avenue in East New York, Brooklyn, specialty building (Z9) at 795 Glenmore Avenue in East New York, Brooklyn, and 1-4 family building (A9) at 353 Shepherd Avenue in East New York, Brooklyn.

On these lots, there is one active new building construction project for a 123-unit, 73,096 square-foot residential (R-2) building. The project was developed by William Lattarulo with plans filed November 15, 2021 and it has not been permitted yet.

The deal closed on October 19, 2022 and was recorded on November 17, 2022.The four properties have 5,608 square feet of built space and 49,857 square feet of additional air rights for a total buildable of 55,500 square feet according to PincusCo analysis of city data. The loan price per built square foot is $4,837 and the price per buildable square foot is $488 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 HousingPlus and Spatial Equity Co. was Teghvir Singh Sethi and Lois A. Murphy. The signatory for NYS Housing Finance Agency and NYC Department of Housing Preservation and Development was Julie M. Behrens. This is financing for a 123-unit affordable housing for women and woman and children.

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 793 Glenmore Avenue.

Prior sales and revenue

Out of the four properties, one with a total of 5,608 square feet of built space generated revenue of $29,310 per year.

The property

The 793 Glenmore Avenue parcel has frontage of 50 feet and is 85 feet deep with a total lot size of 4,250 square feet. The zoning is M1-1/R6A which allows for up to 1 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 $231,000.

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.

The neighborhood

In East New York, the bulk, or 40 percent of the 44.6 million square feet of commercial built space are elevator buildings, with industrial buildings next occupying 21 percent of the space. In sales, East New York has 2.4 times the average sales volume among other neighborhoods with $833.9 million in sales volume in the last two years and is the 4th highest in Brooklyn. For development, East New York has 3.3 times the average amount of major developments relative to other neighborhoods and is the 5th highest in Brooklyn. It had 3.4 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, there were four new building construction projects totaling 121,542 square feet. The largest is a 26-unit, 17,318-square-foot R-2 building developed by Einav Gelberg with plans filed August 27, 2020 and it has not been permitted yet.The second largest is a 26-unit, 17,318-square-foot R-2 building developed by Einav Gelberg with plans filed January 8, 2021 and it has not been permitted yet.

The majority, or 77 percent of the 34,863 square feet of built space are industrial buildings, with mixed-use buildings next occupying 18 percent of the space.

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