Kaufman Organization signs $32.2M refi with Citibank for office in Garment District

Kaufman Organization through the entity Kaufman Arcade Owner LLC as borrower signed a refi loan with lender Citibank through the entity Citi Real Estate Funding Inc. valued at $32.2 million for the office building (O6) at 132 West 36th Street in Garment District, Manhattan.
The deal closed on June 11, 2024 and was recorded on June 27, 2024. The prior lender was JPMorgan Chase which held debt that had an original loan amount of $35 million. The property has 187,350 square feet of built space according to a PincusCo analysis of city data. The loan price per built square foot is $172 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 April 30, 2013, for $1.8 million. The signatory for Kaufman Organization was Steven J. Kaufman.

The property

The office building in Garment District has 187,350 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 75 feet and is 197 feet deep with a total lot size of 14,984 square feet. The lot is irregular. The zoning is M1-6 which allows for up to 10 times floor area ratio (FAR) for manufacturing. The city-designated market value for the property in 2022 is $31.8 million.

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 $3,800 in OATH penalties in the last year.

Development

There are no active new building construction projects or major alteration projects with initial costs more than $1 million on this tax lot.

The neighborhood

In Garment District, The majority, or 69 percent of the 52.3 million square feet of commercial built space are office buildings, with hotel buildings next occupying 13 percent of the space. In sales, Garment District has 1.8 times the average sales volume among other neighborhoods with $487.3 million in sales volume in the last two years and is the 18th highest in Manhattan. For development, Garment District is the 4th most active neighborhood among other neighborhoods. It had 6.8 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. There were three pre-foreclosure suit filed among other office buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of eight of the 13 commercial properties representing 1,307,513 square feet of the 1,700,783 square feet. The largest owner is Yosef Nazar, followed by Solil Management and then Shokrollah Rehanian.
There are no active new building construction projects on this tax block.

The majority, or 98 percent of the 1.7 million square feet of built space are office buildings, with retail buildings next occupying 2 percent of the space.

The borrower

The PincusCo database currently indicates that Kaufman Organization owned at least eight commercial properties in New York City with 1,109,908 square feet and a city-determined market value of $231.1 million. (Market value is typically about 50% of actual value.) The portfolio has $139.3 million in debt, with top three lenders as MetLife, First Republic Bank, and Citibank respectively. Within the portfolio, all identified are office properties. They are all located in Manhattan.

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