Jemal family’s JJ Operating signs $39M loan with Starwood for office in Downtown Brooklyn
JJ Operating through the entity 40 Flatbush De Owner LLC as borrower signed a loan with lender Starwood Mortgage Capital valued at $39 million for the office building (O6) at 40 Flatbush Extension, also known as 146 Concord Street in Downtown Brooklyn, Brooklyn. JJ Operating is also affiliated with ISJ Management.
The deal closed on October 13, 2023 and was recorded on October 23, 2023. The property has 309,952 square feet of built space according to a PincusCo analysis of city data. The loan price per built square foot is $125 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 the landlord was Samuel J. Jemal.
Prior sales and revenue
The 309,952-square-foot property generated revenue of $10.5 million or $34 per square foot, according to the most recent income and expense figures.
The property
The parcel has two buildings with frontage of 385 feet and is 109 feet deep with a total lot size of 35,951 square feet. The lot is irregular. The zoning is C6-2 which allows for up to 6 times floor area ratio (FAR) for commercial and up to 6.02 times FAR for residential. The city-designated market value for the property in 2022 is $49.9 million. The most recent loan totaled 0.0 and was provided by Fortress Investment Group on August 15, 2023.
Violations and lawsuits
There were no lawsuits or bankruptcies filed against the property for the past 24 months. In addition, according to city public data, the property has received 10 DOB violations and $5,000 in OATH penalties in the last year.
Development
On the lot, there are several rehabilitation construction projects with initial costs more than $5 million. The largest is a major alteration project for a 309,952 square-foot B building submitted by Joseph Jemal with plans filed July 5, 2016 and permitted August 10, 2016. The second largest is a major alteration project for a 309,952 square-foot B building submitted by Joseph Jemel with plans filed May 25, 2018 and it has not been permitted yet.
The neighborhood
In Downtown Brooklyn, The bulk, or 40 percent of the 22.4 million square feet of commercial built space are office buildings, with elevator buildings next occupying 24 percent of the space. In sales, Downtown Brooklyn has 3.7 times the average sales volume among other neighborhoods with $1.3 billion in sales volume in the last two years and is the 2nd highest in Brooklyn. For development, Downtown Brooklyn has 2.8 times the average amount of major developments relative to other neighborhoods and is the 6th highest in Brooklyn. It had 2.9 million square feet of commercial and multi-family construction under development in the last two years, which represents 13 percent of the neighborhood’s built space.
The block
On this tax block, PincusCo has identified the owners of two of the two commercial properties representing 309,952 square feet of the 309,952 square feet. The two identified owners are ISJ Management and Tankhouse.
On the tax block, there was one new building construction project filed totaling 36,191 square feet. It is a 27-unit, 36,191 square-foot residential (R-2) building submitted by Tankhouse and filed by Sebastian Mendez with plans filed December 29, 2020 and permitted February 11, 2022.
The majority, or 100 percent of the 309,952 square feet of built space are office buildings, with development buildings next occupying 0 percent of the space.
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