Lam Group Exact Capital sign $167.5M construction loan with Silver Point for 192-unit project in Harlem
Lam Group and Exact Capital Group through the entity 233 West 125th Street Danforth, LLC as borrower signed a new construction loan with lender Silver Point Capital through the entity Victoria Tower Lender LLC valued at $167.5 million for the 192-unit residential elevator development at 233 West 125th Street in Harlem, Manhattan.
The deal closed on March 31, 2022 and was recorded on May 24, 2022. The prior lender was Goldman Sachs, Upper Manhattan Empowerment Zone which held debt that had an original loan amount of $132.1 million. The property has 394,804 square feet of built space according to PincusCo analysis of city data. The loan price per built square foot is $424 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 Lam Group and Exact Capital Group was Kin Chung Lam. The Real Deal first reported the refinancing for the Victoria Tower.
The property
The 233 West 125th Street parcel has frontage of 50 feet and is 199 feet deep with a total lot size of 19,984 square feet. The lot is irregular. The zoning is C4-4A which allows for up to 4 times floor area ratio (FAR) for commercial and up to 4 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $80.6 million.
Violations and lawsuits
There were no lawsuits or bankruptcies filed against the property since September of 2020. In addition, according to city public data, the property has received two DOB violations, $6,250 in ECB penalties, and $12,450 in OATH penalties in the last year.
Development
On these lots, there is one active new building construction project for a 191-unit, 375,187-square-foot R-2 building. The project was developed by Keith Lam with plans filed September 24, 2014 and permitted November 16, 2017.
The neighborhood
In Harlem, the bulk, or 42 percent of the 99.7 million square feet of commercial built space are residential elevator buildings, with residential walkup buildings next occupying 24 percent of the space. In sales, Harlem has 2.2 times the average sales volume among other neighborhoods with $607.8 million in sales volume in the last two years and is the 20th highest in Manhattan. For development, Harlem has 2.8 times the average amount of major developments relative to other neighborhoods and is the 5th highest in Manhattan. It had 2.6 million square feet of commercial and multi-family construction under development in the last two years, which represents 3 percent of the neighborhood’s built space. There were two pre-foreclosure suit filed among other residential elevator buildings in the past 12 months.
The block
On this tax block, PincusCo has identified the owners of one of the 12 commercial properties representing 85,005 square feet of the 832,812 square feet. The identified owner is Jem Realty Management. There are four active new building construction projects totaling 498,409 square feet. The largest is a 191-unit, 375,187-square-foot R-2 building developed by Keith Lam with plans filed September 24, 2014 and permitted November 16, 2017. The second largest is a 82-unit, 80,927-square-foot R-2 building developed by Joel Weiss with plans filed January 26, 2022 and it has not been permitted yet.
The majority, or 45 percent of the 882,616 square feet of built space are residential elevator buildings, with office buildings next occupying 30 percent of the space.
The borrower
The PincusCo database currently indicates that Lam Group owned at least four commercial properties with 732,332 square feet and a city-determined market value of $227.8 million. (Market value is typically about 50% of actual value.) The portfolio has $134.5 million in debt, with top three lenders as Investors Bank, Shanghai Commercial Bank, and Flushing Bank respectively. Within the portfolio, all identified are hotel properties. The bulk, or 92 percent of the built space, is in Manhattan, with Brooklyn next at 8 percent of the space.
Surrounding
Within a 400-foot radius of 233 West 125th Street, Pincusco identified four commercial real estate items of interests occurred over the past 24 months.
Of those four items, three were in new building development. There were two new building permit applications and one new building permit. The most recent of these three items was a filing on January 26, 2022 for a 69,512-square-foot R-2 building with 82 residential units at 260 West 126th Street.
One of those four items was a loan which Fabrics Save-A-Thon borrowed $7.5 million from JPMorgan Chase secured by the 64,589-square-foot, one-unit mixed-use building (K2) on 256 West 125th Street on March 4, 2022.
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