Jacob Schwimmer signs ground lease valued at $15M in Gowanus at site where 92 units planned

Jacob Schwimmer as tenant through the entity 159 Third Realty LLC signed a ground lease valued at $15 million with landlord George Macchia for the midblock industrial building at 159 3rd Avenue in Gowanus, Brooklyn. Plans for a 92-unit building were filed in February by the entity 159 Third Residence LLC.

The deal closed on May 2, 2022 and was recorded on May 18, 2022.

Jacob Schwimmer was the signatory on the lease through the entity 159 Third Realty LLC. George Macchia signed through the entity Asti Holding Corp. as the landlord, which has owned the property since the 1980s.

In February, PincusCo reported that plans were filed for the property. The plans call for the construction of a 92-unit, 68,808-square-foot mixed-use building.

The property has 2,325 square feet of built space and 21,240 square feet of additional air rights for a total buildable of 23,600 square feet according to PincusCo analysis of city data.

The lease price per built square foot is $6,451 and the price per buildable square foot is $635 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 property

The 159 3rd Avenue parcel has frontage of 26 feet and is 83 feet deep with a total lot size of 11,800 square feet. The lot is irregular. The zoning is M1-2 which allows for up to 2 times floor area ratio (FAR) for manufacturing The city-designated market value for the property in 2022 is $752,000.

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 not received any significant violations in the last year.

Development

On these lots, there is one active new building construction project for a 92-unit, 92,098-square-foot R-2 building. The project was developed by 159 Third Residence Llc with plans filed February 11, 2022 and it has not been permitted yet.

The neighborhood

In Gowanus, the bulk, or 38 percent of the 11.5 million square feet of commercial built space are industrial buildings, with 1-4 family buildings next occupying 17 percent of the space. In sales, Gowanus has had very little sales volume relative to other neighborhoods with $205.4 million in sales volume in the last two years. For development, Gowanus is the 10th most active neighborhood among other neighborhoods. It had 4.1 million square feet of commercial and multi-family construction under development in the last two years, which represents 35 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of nine of the 15 commercial properties representing 132,532 square feet of the 229,449 square feet. The largest owner is Gowanus Cubes, followed by Miriam Chan and then Related Companies. There are three active new building construction projects totaling 268,830 square feet. The largest is a 176-unit, 128,744-square-foot R-1 building developed by Miriam Chan with plans filed November 20, 2014 and it has not been permitted yet.The second largest is a 47,988-square-foot S-1 building developed by Chris Lynch with plans filed May 31, 2018 and permitted January 9, 2020.

The majority, or 57 percent of the 237,360 square feet of built space are industrial buildings, with residential elevator buildings next occupying 26 percent of the space.

Surrounding

Within a 400-foot radius of 159 3rd Avenue, PincusCo identified two commercial real estate items of interests occurred over the past 24 months.
Of those two items, two were loans above $5 million totaling $27 million. The most recent of the two was Scott Pedowitz which borrowed $6 million from TD Bank secured by the 12,500-square-foot, one-unit retail building (K1) on 526 Baltic Street on February 14, 2022.

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