Kraus Organization signs $32M loan for 11 rentals with 426 units in Longwood

Kraus Organization through the entity Aldus Green Company L.P. as borrower signed a refi loan with lender Flagstar Bank valued at $32 million for 11 residential elevator properties with 426 residential units including the 51-unit residential elevator building (D5) at 996 Aldus Street in Longwood, Bronx, 53-unit residential elevator building (D3) at 1010 Bryant Avenue in Longwood, Bronx, and 50-unit residential elevator building (D3) at 1025 Aldus Street in Longwood, Bronx.
The deal closed on September 27, 2023 and was recorded on October 17, 2023. The 11 properties have 340,324 square feet of built space according to a PincusCo analysis of city data. The loan price per built square foot is $93 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 Kraus Organization was Stephen R. Kraus.

Because multiple properties have been transacted, some of the following sections will follow the property with the largest assessed value, which in this case, is the property on 1010 Bryant Avenue.

Prior sales and revenue

The owners according to the Department of Housing Preservation and Development includes Stephen Kraus, head officer and Ramiro Velez, agent. The business entities are Kraus Management Inc and Aldus Green Associates.

The property

The parcel has frontage of 120 feet and is 100 feet deep with a total lot size of 11,999 square feet. The zoning is R7-1 which allows for up to 3.44 times floor area ratio (FAR) for residential. The city-designated market value for the property in 2022 is $5.2 million.

Violations and lawsuits

There were no lawsuits or bankruptcies filed against the properties for the past 24 months. In addition, according to city public data, the properties have received five DOB violations, $2 million in ECB penalties, 49 housing violations, $35,615 in OATH penalties, and two housing litigations 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 block

On the tax block of 1010 Bryant Avenue, PincusCo has identified the owners of seven of the seven commercial properties representing 213,678 square feet of the 213,678 square feet. The largest owner is Stagg Group, followed by Shaya Seidenfeld and then New York City Housing Authority.
On the tax block, there was one new building construction project filed totaling 213,037 square feet. It is a 243-unit, 213,037 square-foot residential (R-2) building submitted by Eli Davidowitz with plans filed September 6, 2017 and permitted July 5, 2023.

The majority, or 60 percent of the 213,678 square feet of built space are elevator buildings, with walkup buildings next occupying 27 percent of the space.

The borrower

The PincusCo database currently indicates that Kraus Organization owned at least 59 commercial properties with 2,825 residential units in New York City with 2,685,712 square feet and a city-determined market value of $223.5 million. (Market value is typically about 50% of actual value.) The portfolio has $49.6 million in debt, borrowed from Walker & Dunlop and Capital One. Within the portfolio, the bulk, or 97 percent of the 2,685,712 square feet of built space are elevator properties, with walkup properties next occupying 3 percent of the space. The bulk, or 51 percent of the built space, is in Brooklyn, with Bronx next at 43 percent of the space.

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