Karten, Alcova signs $17M refi with lender Stellar Management for 197-unit project in Concourse

Karten Organization and Alcova Capital Management through the entity Sb Gerard Avenue, LLC as borrower signed a refi loan with lender Stellar Management through the entity SM Bx Lender LLC valued at $17 million for the industrial building (G1) at 580 Gerard Avenue in Concourse, Bronx.
Steller Management is best known as a large owner of multifamily properties.
On the lot, there is one active new building construction project for a 197-unit, 147,087 square-foot R-2 building. The project was developed by Sharone Karten with plans filed September 15, 2021 and it has not been permitted yet.
The deal closed on September 6, 2022 and was recorded on October 27, 2022. The prior lender was Forest Road Company which held debt that had an original loan amount of $17 million. The property has 30,345 square feet of built space and 94,536 square feet of additional air rights for a total buildable of 124,800 square feet according to PincusCo analysis of city data. The loan price per built square foot is $560 and the price per buildable square foot is $136 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 owner bought the property on September 2, 2020, for $16.9 million. The signatory for Karten Organization and Alcova Capital Management was Sharone Karten. The signatory for Stellar Management was Adam Roman.

The property

The 580 Gerard Avenue parcel has frontage of 358 feet and is 89 feet deep with a total lot size of 31,200 square feet. The lot is irregular. 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 $2.8 million.The most recent loan totaled $17 million and was provided by Forest Road Company on November 3, 2021.

Violations and lawsuits

The property was involved in two lawsuits and zero bankruptcies over the past two years. The highest value suit was a $12.9 million judgment concerning a partnership filed on October 25, 2021, by Karten Organization and Sharone Karten against Joshua Schuster and Silverback Development. In addition, according to city public data, the property has received $17,875 in OATH penalties in the last year.

The neighborhood

In Concourse, the bulk, or 42 percent of the 13 million square feet of commercial built space are elevator buildings, with industrial buildings next occupying 17 percent of the space. In sales, Concourse has had very little sales volume relative to other neighborhoods with $149.9 million in sales volume in the last two years. For development, Concourse has near average amount of major developments among other neighborhoods and is the 9th highest in Bronx. It had 1 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 this tax block, PincusCo has identified the owners of two of the seven commercial properties representing 107,088 square feet of the 159,164 square feet. The two identified owners are Dhs and Karten Organization.
On the tax block, there was one new building construction project filed totaling 147,087 square feet. It is a 197-unit, 147,087-square-foot R-2 building developed by Sharone Karten with plans filed September 15, 2021 and it has not been permitted yet.

The majority, or 49 percent of the 159,164 square feet of built space are office buildings, with industrial buildings next occupying 34 percent of the space.

The borrower

The PincusCo database currently indicates that Karten Organization owned at least one commercial property in New York City with 30,345 square feet and a city-determined market value of $2.8 million. (Market value is typically about 50% of actual value.) The portfolio has $17 million in debt, borrowed from Forest Road Company. The portfolio consists of at least a single industrial property. It is located in Bronx.
The PincusCo database currently indicates that Alcova Capital Management owned at least one commercial property in New York City with 30,345 square feet and a city-determined market value of $2.8 million. (Market value is typically about 50% of actual value.) The portfolio consists of at least a single industrial property. It is located in Bronx.

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