KPG Funds signs $49.6M refi loan with Sabal, GDS Brightstar for office rehab in Little Italy

KPG Funds through the entity KPG 480 Broadway Owner LLC as borrower signed a refi loan with lender Sabal Investment Holdings and GDS Brightstar through the entity Ssof Crosby, LLC valued at $49.6 million for the office and retail building (K4) at 480 Broadway in Little Italy, Manhattan, also with the address 40 Crosby Street.
The deal closed on June 15, 2023 and was recorded on June 26, 2023. The prior lender was Thorofare Capital which held debt that had an original loan amount of $15.7 million.
The property has 55,015 square feet of built space according to a PincusCo analysis of city data. The loan price per built square foot is $901 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 January 13, 2022, for $17.1 million. The signatory for KPG Funds was Gregory Kraut. The signatory for Sabal Investment Holdings and GDS Brightstar was Stephen Drakeford Ayers. The financing was arranged by Nick Scribani, Dustin Stolly and Jordy Roeschlaub of Newmark.

Prior sales and revenue

The 55,015-square-foot property generated revenue of $8.3 million or $150 per square foot, according to the most recent income and expense figures.

The property

The building in Little Italy has 55,015 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 72 feet and is 199 feet deep with a total lot size of 9,931 square feet. The lot is irregular. The property is in the SoHo-Cast Iron Historic District. The city-designated market value for the property in 2022 is $41.3 million. The most recent loan totaled $15.7 million and was provided by Callodine Thorofare on January 13, 2022.

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 $1,300 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 Little Italy, The bulk, or 33 percent of the 4.1 million square feet of commercial built space are office buildings, with walkup buildings next occupying 25 percent of the space. In sales, Little Italy has had very little sales volume relative to other neighborhoods with $153.1 million in sales volume in the last two years. For development, Little Italy has had very little major development activity relative to other neighborhoods.It had 235,643 square feet of commercial and multi-family construction under development in the last two years, which represents 6 percent of the neighborhood’s built space. There was one pre-foreclosure suit filed among other retail buildings in the past 12 months.

The block

On this tax block, PincusCo has identified the owners of seven of the 20 commercial properties representing 271,543 square feet of the 387,586 square feet. The largest owner is Zada Realty, followed by Wing Yee and then Tri-Star Equities.
There are no active new building construction projects on this tax block.

The majority, or 40 percent of the 387,586 square feet of built space are office buildings, with retail buildings next occupying 26 percent of the space.

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